Cross-market volatility strategies
FARMTHE CHAOS.HEDGE THEDIRECTION.
We’re building liquidity strategies for volatile Elysium pools that manage HYPE/USD exposure with HyperCore perpetuals.
01 / THE OPPORTUNITY
Two markets.
One strategy.
Volatile pools can generate swap fees for liquidity providers. The same price moves can erode the dollar value of their inventory.
In a TOKEN/HYPE pool, both assets can fall in dollar terms when HYPE falls. A HyperCore short can offset some of that move while leaving the LP in the pool. Whether fees cover losses and costs is an open question.
02 / THE MECHANISM
Measure exposure.
Size the hedge.
Switch shocks to see when the HYPE short offsets an LP loss and when the paired token drives losses of its own.
TOKEN/HYPE flat. Both LP assets lose dollar value. The short gains as HYPE falls. Combined $0 before fees, funding and costs.
Elysium LP position
Hold TOKEN and HYPE inventory. Swaps can generate fees.
Exposure engine
Estimate the LP’s sensitivity to HYPE/USD.
HyperCore HYPE perp
Size an offsetting HYPE short with separate margin.
04 / COMBINED STRATEGY
- LP inventory P&L
- -$400
- + attributable LP fees if earned
- Gross short P&L
- +$400
- + signed funding − execution costs
- Combined before fees and costs
- $0
- Zero funding and fees assumed
Residual risk: TOKEN/HYPE losses remain in the LP leg. A HYPE short does not offset a falling paired token when HYPE/USD is flat.
$1,000 full-range 50/50 LP · 100% initial short · 2× assumed leverage · $500 separate margin. Single terminal price shock. Fees, funding and execution costs are zero in this illustration.
03 / STRATEGY LAB
Strategy Explorer
Move either market, size the short and compare each leg on the capital it actually commits.
Model notes
Prices, execution and costs here are modeled inputs, not executed trades. The historical replay uses archived price observations but also models positions. See the risk details and export for full assumptions.
Unhedged net P&L
−$400.00
−26.67% on equal capital
Hedged net P&L
$0.00
0.00% on equal capital
Net hedge effect
+$400.00
Gross short + funding − costs
The benchmark leaves the margin amount in idle cash at 0%. On the LP alone, the unhedged return is −40.00% on $1,000.00.
Price & cost scenarios
HYPE falls 40% in USD. TOKEN holds its price in HYPE.
The HYPE short leaves relative-price exposure in the LP.
Fixed HYPE short notional as a percentage of starting LP value.
Funding & execution assumptions
Positive funding credits the short. Rates and costs are scenario inputs.
LP fee sensitivity
Percentage of LP capital for this scenario. The same assumption adds the same dollars to both outcomes. It represents no earned yield.
Assumed fee in each case $0.00
Hedged P&L waterfall
The LP and the short settle in one modeled ledger. Margin is separate from P&L.
* Hypothetical LP fee assumption. Both LP outcomes receive it equally.
P&L breakdown
Net P&L vs HYPE/USD
Terminal HYPE moves from −80% to +100%, with TOKEN/HYPE held at 0%. The short changes the slope against HYPE/USD.
Residual TOKEN/HYPE risk
$0.00 inventory effect versus the same HYPE/USD move with TOKEN/HYPE flat. The HYPE short leaves this relative-price risk in place.
Inventory and hold benchmark
Illustrative TOKEN starts at 1 HYPE per token. Inventory can change as the ratio moves.
- HYPE units
- 12.5000 → 12.5000
- TOKEN units
- 12.5000 → 12.5000
- Hold P&L
- −$400.00
- LP vs hold
- $0.00
Estimated LP fees to break even $0.00. This is an arithmetic threshold under the selected assumptions.
04 / SOURCE-BACKED PROOF
Observed Market Replay
Explore archived KNTQ/HYPE pool and HYPE perp observations. Compare modeled positions, stress the path or export a receipt.
Replay inputs
Strategy receipt
2026-11-07 23:00 UTC → 2026-11-08 11:00 UTC · 12 matched hours
Observed market inputs · Capture 2026-11-08 22:32 UTC · Latest matched close was 33 min old at capture.
1.40% on equal capital
$1,000.00 committed
1.75% of committed capital
1.52% on equal capital
$1,250.00 committed · includes $250.00 margin
1.52% of committed capital
Equal budget $1,250.00 in both cases. Unhedged keeps $250.00 in idle cash at 0%. Hedged commits that amount as margin. Returns cover this window, before unmeasured LP fees and excluded costs.
Range 0.005629–0.007015 HYPE/KNTQ · ticks 49600 to 51800. 0 closes outside or on the range boundary, 4 hourly candles touched or crossed a boundary after entry.
- Hold value (HYPE / USD)
- 13.418 / $1,032.24
- LP inventory value (HYPE / USD)
- 13.226 / $1,017.52
- LP inventory change
- $17.52
- LP vs hold (HYPE / USD)
- -0.191 / -$14.72
- LP swap fees
- NOT_MEASURED
- KNTQ inventory
- 935.15 → 206.03
- HYPE inventory
- 7.005 → 11.814
- Fixed short (HYPE / initial USD notional)
- 6.468 / $500.00
- Gross short P&L at close
- $2.39
- Signed funding
- $0.07
- Modeled taker fees
- −$0.50
- Modeled slippage
- −$0.50
- Net hedge effect
- $1.46
- Extra initial margin at 2×
- $250.00
- Lowest proxy margin equity
- $246.23
Hypothetical LP fee analysis
Observed prices and funding · 2026-11-07 23:00 UTC → 2026-11-08 11:00 UTC
Total hypothetical LP fees needed to reach zero modeled P&L for this window, rounded up to the cent. Excluded costs stay outside the calculation.
Same LP position, same assumed fee dollars in both outcomes. The hedge contributes $1.46 either way. The base comparison and receipt exclude this overlay.
Liquidation is possible before margin equity reaches zero. The proxy uses perp candle highs and close-based funding, without maintenance tiers or intrahour margin replay. A HYPE short leaves KNTQ/HYPE relative-price risk. Hedged and unhedged use equal LP capital. The hedge uses extra margin.
Modeled fills use perp candle closes with 5 bps slippage and 5 bps taker fees per side. Funding uses the hourly perp close as a notional proxy. Totals exclude unmeasured LP fees, pool entry/exit costs, gas, bridging, rebalancing and liquidation effects.
Market provenance
Pool ID (Elysium 99901) 0xc96bfd21d36f8e7252f0d80fcb5f3bcacdf47c8b927b20711104713ebeb383ac
05 / ROADMAP
From strategy lab
to live vaults.
The aim is to adapt liquidity and hedge sizing as markets change. Each step needs independent evidence before handling funds.
NOW
Strategy Lab
Explore the hedge, then audit a source-linked replay and export its assumptions.
In this releaseNEXT
Position Watch
Track LP range, inventory and estimated HYPE/USD exposure as they change.
Future roadmapLATER
Execution tools
Prepare reviewed liquidity and hedge adjustments within explicit size and collateral limits.
Future roadmapVISION
Adaptive volatility vaults
Manage liquidity and hedge sizing dynamically under transparent risk limits.
Future roadmap
06 / FAQ & RISKS
What stays
exposed.
A HYPE hedge addresses one risk factor. Relative price, execution, funding, collateral and smart-contract risk remain.
Which inputs are observed?
The replay uses indexed Elysium KNTQ/HYPE pool observations and observed HyperCore HYPE prices and funding. Positions, fills and execution costs are modeled. The Explorer uses hypothetical market moves and cost assumptions.
What does the HYPE hedge cover?
The short targets HYPE/USD direction. Its fixed size uses starting LP value, while LP inventory and exposure change with prices. Paired-token risk, basis and liquidation risk remain.
How should I read the LP fee inputs?
Attributable replay LP fees are NOT_MEASURED. A hypothetical fee applies equally to both cases because the LP position is the same. The dollar hedge effect comes from the short, funding and costs.
What would the future protocol do?
Position monitoring, execution tools and adaptive vaults are roadmap work. The current Strategy Lab is a read-only model with no custody, wallet connection, trade execution or deposits.
Are these official Elysium or Hyperliquid products?
HYPE Volatility Engine is an independent prototype. Elysium and HyperCore are the venues the strategy is designed around.