Hyperliquid, Will It Also Support Coin Staking Rewards?

Original Title: "Hyperliquid to Support Coin Stock Dividends"
Original Author: Azuma, Odaily Planet Daily

On August 12th, Beijing Time, Hyperliquid founder Jeff Yan announced a progress update in the official Discord channel. Due to the original technical-oriented wording, many people overlooked or underestimated the significance of this update.

Literal Translation

Below is the direct translation of Jeff Yan's original statement.

· According to feedback from builders, HIP-1 will add the following function controlled by the token deployer: scaleWei { token, totalWei, referenceToken, systemAddress }.

· This operation will automatically transfer totalWei of the token from the systemAddress to these users based on the balance of referenceToken held by the users. The calculation process will be rounded down and does not include the systemAddress itself. For example, when token == referenceToken, this function can be used for redenomination.

· There are two possible systemAddresses: Core → the system address of EVM; a Treasury address specified by the deployer and capable of providing a signature. It is important to note that the EVM itself does not have this atomic functionality. Therefore, if the relevant token exists simultaneously in the EVM environment, the corresponding smart contract may need to add custom logic to synchronously apply this operation to the token balance on the EVM.

· When the token and referenceToken are the same token: all open orders will be canceled, and then recreated according to the actual redenomination ratio, with rounding down to the precision required by szDecimals during the recreation; totalWei is allowed to be negative. This allows for reverse redenomination.

· Feedback is welcome to ensure that this feature can meet real-world usage needs as widely as possible.

Clearly, without a certain understanding of the smart contract concept, it is difficult to grasp what Hyperliquid's latest update really means.

Layman's Terms

In simple terms, Hyperliquid is adding to HIP-1 a previously uncommon capability—directly adjusting user assets in bulk and programmatically on the "balance layer" of HyperCore.

What is most important here is not the function name scaleWei and its related parameters, but what they can actually do.

Assume there is a token A on Hyperliquid, with Alice holding 100 tokens, Bob holding 50 tokens, and Charlie holding 10 tokens. If there are 1600 tokens of token B in an address, with A as the referenceToken, the system can automatically distribute these 1600 B tokens based on each person's proportion of A holdings.

The distribution will be as follows:

· Alice, with a 62.5% share of A, receives 1000 B tokens;

· Bob, with a 31.25% share, receives 500 B tokens;

· Charlie, with a 6.25% share, receives 100 B tokens.

Users do not need to click Claim or individually call smart contracts; HyperCore can directly adjust account balances according to established rules.

And if token == referenceToken, a "redenomination" will be carried out, making the change even more straightforward.

For example, if the original holding status of a stock token is that Alice holds 100 shares, Bob holds 50 shares, and Charlie holds 10 shares, and there is a 1:10 stock split, the system can directly adjust the balances.

The adjusted holdings will be:

· Alice holds 1000 shares;

· Bob holds 500 shares;

· Charlie holds 100 shares.

Each person's holding proportion remains unchanged, only the valuation unit has changed. The reverse is also true.

In the update, Hyperliquid also specifically considered the issue of orders in transactions. If an asset undergoes a 1:10 stock split, the 100-share sell order previously placed by the user obviously cannot remain unchanged, otherwise the post-split order quantity would not match the new holding system. Therefore, the system will cancel the original orders, then re-create them according to the new ratio, and perform precision processing on the quantity based on szDecimals. In other words, this is actually to reprice balances, orders, and other transaction states together.

Understanding the update logic, what is the use of this "programmability at the balance level"?

Use Cases

The content disclosed by Jeff Yan mainly describes the underlying capability of scaleWei, but around this capability, we can already glimpse several clear application directions related to stock tokens.

Scenario 1: Dividends

Dividends are one of the most basic rights of traditional stocks. In the traditional brokerage system, this is a standard corporate action; and in the typical EVM model, if similar operations are to be performed, they usually need to be recorded through smart contracts, and users have to claim them actively, or the project team has to distribute them one by one.

scaleWei provides another possibility—directly distributing dividend assets to users according to the holding proportion based on the stock token balance on HyperCore. Assuming that in the future, a publicly listed company's stock token appears on Hyperliquid, and the company decides to pay a $1 dividend per share—Alice holds 100 shares, Bob holds 50 shares, and Charlie holds 10 shares—the system can directly distribute the dividend assets to their respective accounts according to the holding proportion, without users needing to manually claim them or the project team having to individually invoke smart contracts. HyperCore itself can complete this batch transfer.

Scenario 2: Stock Splits and Mergers

This is actually the scenario that this update has explicitly corresponded to. When the token and referenceToken are the same asset, scaleWei can uniformly adjust the balances of all holders.

Therefore, in the future, if a HIP-1 asset needs a 1:10 stock split, a 10:1 reverse stock split, or even an adjustment of the minimum trading unit, it can be executed directly, and the system will synchronously cancel and rebuild unfilled orders. For a trading system that truly aims to support stocks and ETFs, this kind of "corporate action" is a standard feature.

Scenario Three: Rebasing

A similar mechanism can also be used for Rebase. Simply put, when the total supply or unit of an asset undergoes adjustment (especially common during pre-market stock token conversions, where the share capital amount will be adjusted accordingly), the relative position ratios between users remain unchanged.

Previously, such operations often relied on the logic of the token contract itself, but in the future, it can become a native capability of HyperCore.

Scenario Four: Airdrop

Another more straightforward scenario is airdropping. referenceToken does not have to equal the distributed token, so theoretically, assets can be distributed directly to token B based on A's holding proportion.

For example, if a project decides to distribute another token to holders of a HIP-1 asset, the system can directly read the user's A balance on HyperCore, and then distribute B from a specified Treasury address in proportion.

This means that, at least within HyperCore, some traditional "claim airdrop" actions may be further simplified to have the system directly perform balance distributions.

Addressing the Shortcomings of "Corporate Actions" in Coin Stocks

It is important to emphasize that the update announced by Jeff Yan this time is currently focusing solely on the underlying functionality and does not imply that Hyperliquid has announced a dividend for stock tokens on the platform. However, from an infrastructure perspective, the technical path required for the "asset distribution to accounts based on holding proportions" needed for the above application scenarios has already been established.

Considering the potential application scenarios, the true significance of this Hyperliquid update lies in its potential to address the inherent shortcomings in on-chain asset "corporate actions."

Over the past few years, when the industry discussed tokenized stocks, the focus was often on whether "stocks can be put on the blockchain." However, if we truly want to move stocks to the blockchain, the issue is far more complex than just that. After stock issuance, a series of corporate actions such as dividends, stock splits, reverse stock splits, rights issues, and asset distributions will continue to occur.

Therefore, a truly comprehensive on-chain stock infrastructure needs to not only be able to "trade stocks," but also to handle asset state changes beyond these trades, which is exactly the part that Hyperliquid's latest update is beginning to address.

From this perspective, scaleWei looks more like filling in a piece of the puzzle for the next phase of Hyperliquid — allowing on-chain financial assets to not only be "tradable," but also to undergo various corporate actions like real-world financial assets.

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