Hyperdrive has launched its new Leverage Markets protocol aimed at reducing the volatility and liquidation risks associated with traditional crypto leverage.
The platform replaces real-time market price feeds with redemption-based collateral values, allowing assets to be valued based on their contractual redemption rates.
“When collateral has a contractual redemption path, traders don’t need oracles or DEX liquidity,”
Said Hyperdrive co-founder, Cain O’Sullivan.
The system is designed to prevent cascading liquidations that often occur when collateral values drop suddenly in on-chain lending markets.
Hyperdrive’s model instead settles positions through asset redemption mechanisms rather than forcing collateral sales into decentralised exchanges.
The approach is designed for tokenised treasuries, private credit assets and liquid staking tokens, which often struggle to function efficiently as collateral in existing lending protocols.
Hyperdrive’s Leverage Markets are currently live on testnet, with a mainnet launch planned for the second quarter of 2026 on Ethereum followed by expansion to Avalanche and Hyperliquid.