Hyperliquid Infringement Dispute: A Case of Legitimate Rights Protection or Opportunistic Marketing?

On February 2nd, Hyperliquid announced that the HIP-4 proposal had gone live on the testnet. This proposal aims to build a prediction market infrastructure by introducing “Outcome Trading.” Furthermore, from late January to early February 2026, the क्रिप्टोcurrency market trended weaker, with Bitcoin’s price once falling below the $75,000 mark, leading to a broad market correction. However, Hyperliquid’s native token HYPE defied the trend, accumulating gains of over 40% in the past week.

Image Source: Hyperliquid Tweet

However, amidst its business expansion, Hyperliquid has encountered allegations of technical infringement from a peer. On February 2nd, Sky Guo, founder of the RWA public chain project Cypherium, publicly accused Hyperliquid on social media of infringing on its patented technology. Sky Guo believes that Hyperliquid’s underlying consensus engine, HyperCore, uses a patented, PoS-version optimized HotStuff algorithm and demanded that Hyperliquid cease the infringement.

Image Source: Sky Guo Tweet

Core Dispute: The Technical Boundaries of Patent US 11,411,721 B2

The core of this dispute points to a formal patent issued by the United States Patent and Trademark Office (USPTO) on August 9, 2022, with the number US 11,411,721 B2. The assignee of this patent is Cypherium Blockchain Inc., and its title is “Systems and methods for selecting and utilizing a committee of validator nodes in a distributed system.”

The patent details a mechanism for dynamically selecting and reconfiguring a validator committee, supporting node election via PoW, PoS, or PoA, and emphasizes the use of Aggregate Signatures to improve consensus efficiency and fault tolerance. The patent also proposes specific implementation paths such as Two-phase Reconfiguration and Tree-structured Hierarchy.

Cypherium argues that these technologies are key to implementing HotStuff in large-scale, high-performance networks (like Hyperliquid’s 200,000 TPS), and this constitutes the core barrier of the patent rights.

First Page of Cypherium Patent US 11,411,721 B2 | Image Source: Google Patents

The technical controversy lies in both parties’ improvements and applications of the consensus algorithm HotStuff, but HotStuff itself is an open-source consensus protocol publicly available in academia from 2018 to 2019.

Cypherium’s CypherBFT combines PoW with HotStuff to achieve permissionless operation, while Hyperliquid’s HyperBFT is a custom variant optimized for low-latency transactions.

However, Cypherium claims its patent covers specific enhancement logic for HotStuff in a PoS environment. Hyperliquid has not yet responded regarding whether HyperBFT uses the unique claims covered by the patent.

Escalation of Accusations: From Questioning Transparency to Alleging Infringement

Prior to this infringement accusation, Sky Guo’s criticism of Hyperliquid primarily focused on code transparency.

Image Source: Sky Guo Tweet

This opacity, on one hand, protects Hyperliquid’s commercial advantage in high-concurrency processing; on the other hand, it makes it difficult for the project to prove its innocence through public audits when facing external technical scrutiny.

Sky Guo believes that it is precisely HyperCore’s adoption of the dynamic committee selection logic from its patent that enables its sub-second finality.

Sky Guo claims to have sent a legal letter to the Hyperliquid team and relevant responsible parties, accusing them of using the patented technology without permission. He stated that the Hyperliquid side is currently avoiding the issue and has not responded to the legal correspondence.

Solid Evidence or Vaporware बाज़ारing?

From a superficial legal and technical logic perspective, the US patent US 11,411,721 B2 held by Cypherium is indeed a formally issued legal document, and its scope of protection does cover key aspects of consensus mechanisms such as dynamic committee selection, signature aggregation, and two-phase reconfiguration.

According to Hyperliquid’s publicly available technical documentation, the underlying HyperCore engine indeed runs on a custom variant of the HotStuff algorithm called HyperBFT, and HotStuff is precisely the technology targeted for improvement in the patent’s claims.

Image Source: Hyperliquid Docs

Furthermore, because Hyperliquid’s core codebase is currently closed-source, this black-box nature makes it difficult for outsiders to determine through public code audits whether its specific implementation path circumvents the relevant patent.

However, in reality, HotStuff and its variants are hardly new in the high-performance Layer 1 space. From Meta’s (formerly Facebook) defunct Libra/Diem, to the currently prominent Aptos (AptosBFT), Monad (MonadBFT), and even Sui’s early research iterations on core consensus, all have been deeply influenced by HotStuff’s linear communication complexity and responsive design.

Additionally, the timing and context of this accusation are thought-provoking. The time Sky Guo issued the infringement accusation (12:00 PM, February 3rd) coincided with strong market performance of the HYPE token and the increased attention on prediction markets driven by the HIP-4 proposal.

On social platforms, some KOLs expressed support for this legal action, but the comment sections of related posts contained content suspected to be promotional for “G-अदला-बदली.” “G-Exchange” is a new project about to launch within the Cypherium ecosystem. The coincidence in timing between this technical accusation and the new project’s pre-launch hype makes this series of legal actions appear suspiciously like vaporware marketing to generate buzz for the new business.

Image Source: Sky Guo and other X account tweets

Whether the accusation is a “real hammer” or “vaporware marketing,” Hyperliquid seems to have reached a crossroads. As its business expands, community calls for increased transparency are growing. Faced with infringement doubts, will Hyperliquid stick to its black-box advantage, or will it prove its innocence through partial open-sourcing or third-party audits? This concerns the trust foundation of its decentralization narrative.

Note: 9.92 million HYPE tokens, accounting for 2.79% of the circulating supply and valued at approximately $357 million (based on a $36 price), are scheduled to be unlocked on February 6th.

यह लेख इंटरनेट से लिया गया है: Hyperliquid Infringement Dispute: A Case of Legitimate Rights Protection or Opportunistic Marketing?

Related: Interactive Tutorial | Perle Labs, with $17.5M in Funding, Launches Season 1 Points Campaign

Author | Asher (@Asher_ 0210) On January 19th, Perle Labs, an AI training data platform driven by human experts, announced on X that its beta phase concluded on January 6th. The first season event is now officially live. Users can earn points by completing various tasks. Below, Odaily provides a quick overview of Perle Labs and a step-by-step guide to participating in the first season event to earn points and potentially qualify for a future token airdrop. Perle Labs: An AI Training Data Platform Driven by Human Experts Project Introduction Perle Labs is an AI training data platform driven by human experts, focusing on providing high-quality datasets to support decentralized AI development. According to ROOTDATA, Perle Labs has raised a total of $17.5 million in funding to date. On the…