How to Trade On-Chain Perpetual Contracts on Hyperliquid: A Beginner's Guide
If you want to trade on-chain perpetual contracts on Hyperliquid, there's no need to register or go through KYC. As long as you have a wallet that can receive USDC, you can connect and start. But it's not like any centralized exchange you've used—your positions, margin, and liquidation lines are all on-chain, and every order is publicly verifiable.
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Below is a beginner's guide. Follow the steps in order, and you'll be able to open your first perpetual contract position on Hyperliquid.
1. Prepare a Compatible Wallet and Deposit USDC
What to do: Prepare an EVM-compatible wallet (like MetaMask, OKX wallet, Gem Wallet) and deposit USDC on the Arbitrum network as margin.
How to do it:
Hyperliquid currently accepts USDC deposits mainly via the Arbitrum network. Your wallet also needs a small amount of ETH to cover Arbitrum gas fees.
Situation A: You already have USDC on Arbitrum. Proceed to the next step directly. Just keep a small amount of ETH (0.001-0.005 ETH is enough) for gas fees.
Situation B: Your USDC is on a centralized exchange (like OKX, Binance). Withdraw from the exchange, select the Arbitrum network, and send USDC to your wallet address. When withdrawing, double-check the network name. Selecting the wrong chain will result in lost funds. After withdrawal, confirm that the USDC balance has arrived in your wallet.
Situation C: You only have USDC on other networks or other assets. Use the wallet's built-in bridge or a third-party bridge (like Across, Stargate) to bridge assets to Arbitrum, then swap to USDC. Beginners are advised to directly follow Situation B, as cross-chain operations can be error-prone for newcomers.
When is this step complete? In your wallet on the Arbitrum network, your USDC balance is greater than the margin you plan to use, and your ETH balance is enough to cover at least 3-5 on-chain transactions (around 0.002-0.005 ETH).
Prerequisites: Your wallet must have the Arbitrum network configured. If you haven't added it yet, go to your wallet's "Network Settings," search for Arbitrum One, or use Chainlist to add it automatically. For basic wallet operations, it's recommended to read "How to Use a Decentralized Wallet Safely" first.
Common failure reason: Choosing the wrong network when withdrawing. If you withdraw from an exchange using the ERC20 or Solana network to your wallet, but Hyperliquid only accepts USDC on Arbitrum, the funds will arrive but cannot be deposited into Hyperliquid. You would need to use a cross-chain bridge to convert them, incurring extra fees and time.
Risk reminder: If your wallet seed phrase is leaked, all assets could be stolen. Throughout this guide, you will never need to provide your seed phrase or private key to anyone.
2. Connect Your Wallet to the Hyperliquid Platform
What to do: Visit the Hyperliquid app and bind your wallet using WalletConnect.
How to do it:
Open your browser and go to the Hyperliquid app page (app.hyperliquid.xyz).
Click the "Connect Wallet" button in the top right corner.
Select "WalletConnect," scan the QR code with your wallet app, or confirm the connection request within the wallet.
Read and agree to the platform terms.
After a successful connection, the top right corner of the page will display an abbreviation of your wallet address. Your wallet address is your account ID on Hyperliquid.
When is this step complete? The page's top right displays your wallet address, and the "Connect Wallet" button is no longer shown.
Prerequisites: Step 1 completed, with a USDC balance in your wallet.
Common failure reason: The wallet network is not switched to Arbitrum. Some wallets may fail to sign or become unresponsive if the network is wrong during connection. Make sure your wallet is on Arbitrum One.
Risk reminder: All trading records and positions are public. Hyperliquid's on-chain order book is completely transparent. Anyone can see the direction and size of your positions. If you value privacy, be mindful of your position sizes.
3. Deposit USDC from Your Wallet into the Hyperliquid Contract Account
What to do: "Deposit" the USDC in your wallet to the Hyperliquid platform. This step is an on-chain transfer that moves funds into Hyperliquid's smart contract custody.
How to do it:
On the Hyperliquid page, click on "Portfolio" at the top or the "Deposit" button.
Select USDC as the deposit asset and enter the amount.
Click confirm, your wallet will prompt a transaction request. Sign it and wait for on-chain confirmation.
After confirmation, the "Contract Account Balance" on the page will update.
Hyperliquid has minimum deposit and withdrawal thresholds. It's recommended to deposit at least 100 USDC for your first time to ensure you can open a position smoothly.
When is this step complete? The USDC balance on the Hyperliquid page shows the amount you just deposited, and the "Spot" or contract account balance has been updated.
Prerequisites: Wallet is connected and has sufficient USDC.
Common failure reason: Insufficient ETH in the wallet to pay Arbitrum network gas fees. The deposit operation is an on-chain transaction requiring gas. Ensure your ETH balance is enough for a few transactions.
Risk reminder: The deposited funds enter Hyperliquid's smart contracts. Although Hyperliquid has not experienced major security incidents to date, smart contract risk always exists. Do not deposit more than you can afford to lose.
4. Choose a Trading Pair and Leverage, and Differentiate Between Isolated and Cross Margin
What to do: Select the perpetual contract trading pair you want to trade and set your leverage multiple. At the same time, you must choose between "Isolated" and "Cross" margin modes—this is critical for beginners.
How to do it:
On the left or top of the trading page, click the trading pair name (like "BTC/USDC") to browse or search for the coin you want to trade.
In the order panel, find the leverage slider and adjust the multiple. Hyperliquid supports up to 50x leverage.
Select margin mode: Isolated or Cross.
Situation A: You are a beginner and only plan to trade one coin—choose Isolated. In isolated mode, the margin you allocate to this position is fixed. If the market moves against you and you lose money, the maximum loss is limited to that position's margin. It won't touch any other funds in your account. This is the safest for beginners.
Situation B: You hold multiple positions at once and are experienced in risk management—choose Cross. In cross mode, all available funds in your account serve as margin for all positions. If one position gets liquidated, it can drag other positions down as well. Not recommended for beginners.
When is this step complete? You have selected a trading pair, set the leverage to a number you're comfortable with (beginners are advised to start with 2-3x), and clearly chosen "Isolated" as the margin mode.
Prerequisites: Your contract account has a USDC balance.
Common failure reason: Beginners selecting cross margin and having a small loss in one position pull down the entire account. This is the most common mistake newcomers make on Hyperliquid. If you're only trading one coin, the difference between isolated and cross is small, but once you open a second position, the advantage of isolated becomes clear.
Risk reminder: Leverage amplifies not only profits but also losses. With 50x leverage, a 2% adverse price move can wipe out your entire margin.
5. Open a Position: Limit Order or Market Order
What to do: Submit a perpetual contract order to buy (long) or sell (short).
How to do it:
Situation A: You're not in a rush and want to control your entry price—place a Limit Order. In the order panel, select "Limit," enter your desired price and amount, then click "Buy/Long" or "Sell/Short." The order won't execute immediately; it will sit on the order book until the price is reached.
Situation B: You want to execute immediately and don't mind the exact price—place a Market Order. In the order panel, select "Market," enter the amount, and click to submit. The system will execute the order at the best available price right away.
Regardless of the method, after submitting, your wallet will pop up a signature request. Just confirm to sign. (Hyperliquid's one-click trading does not require a gas fee signature for every trade, but opening and closing positions still requires a confirmation signature.)
When is this step complete? The order status changes to "Filled," and the "Positions" area at the bottom of the page shows your position details, including entry price, quantity, unrealized PnL, and liquidation price.
Prerequisites: Margin mode, leverage, and trading pair have all been set.
Common failure reason: Ignoring the impact of fees and funding rate on PnL. Hyperliquid's perpetual contracts settle funding rates every 8 hours. If you hold a position for over 8 hours and your direction aligns with the majority, you will pay the funding fee; if it's opposite, you will receive it. This fee is automatically deducted from or added to your balance. Insufficient balance can trigger liquidation.
Risk reminder: Be sure to check the liquidation price before opening a position. The Hyperliquid page displays your liquidation price. If the price hits it, your position will be automatically closed, and your margin will be wiped out.
6. Set Stop-Loss and Take-Profit and Monitor Your Position
What to do: Immediately set take-profit and stop-loss orders after opening a position to lock in profits and limit losses.
How to do it:
In the "Positions" area, find your position and click on "Set TP/SL" or a similar button.
Set a Take-Profit price: when reached, the position will automatically close at a profit.
Set a Stop-Loss price: when reached, the position will automatically close at a loss.
Confirm the settings.
When is this step complete? The page shows that the TP/SL orders are active, with status "Active."
Prerequisites: A position has been opened.
Common failure reason: Setting the stop-loss too tight, getting stopped out by normal market noise, and then the price moves in your anticipated direction. It's recommended to set the stop-loss based on the asset's average daily volatility.
Risk reminder: In extreme market conditions (like during major news announcements), your TP/SL orders may not execute at your set price but at the prevailing market price (slippage). This is a common risk across all exchanges, not unique to Hyperliquid.
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7. Closing a Position: Sell or Buy to Close
What to do: When your profit target is reached or a stop-loss condition is triggered, close your current position.
How to do it:
In the "Positions" area, find your position.
Click the "Close" button.
A confirmation window will pop up, where you can choose to close via market or limit order.
Confirm and wait for on-chain confirmation.
If you are long, closing means selling; if you are short, closing means buying. The operation logic is the opposite of opening a position.
When is this step complete? The position is no longer shown in the "Positions" area, and the realized PnL has been settled into your USDC balance.
Prerequisites: The position has not been liquidated, and your account has enough balance to cover any applicable funding fees.
Common failure reason: Forgetting to account for the current funding rate when closing. If your position is on the side that pays the funding rate, a funding fee may be deducted from your balance upon closure, making your actual profit lower than expected.
FAQ
Q1: What is the biggest difference between Hyperliquid and a centralized exchange's perpetual contracts? Two core differences: First, no KYC or registration is needed—just connect your wallet. Second, all orders are public on-chain, including the movements of large holders. Anyone can see the real-time leaderboard of positions. This means you can see what "whales" are doing, but it also means your position is visible to everyone.
Q2: How exactly is the funding rate calculated, and when do I have to pay? The funding rate settles every 8 hours (usually around 04:00, 12:00, and 20:00 Beijing time). The rate can be positive or negative. When the rate is positive, longs pay shorts; when negative, shorts pay longs. Funding rates on Hyperliquid can fluctuate significantly, so always check the real-time funding rate on the page before opening a position.
Q3: What are the maker and taker fees? Currently, Hyperliquid's maker fee is 0.015% and the taker fee is 0.045%. Using a limit order that doesn't immediately execute usually incurs the maker fee (cheaper); using a market order incurs the taker fee. You can view your fee tier on the fees page—the higher your trading volume, the lower the fees.
Q4: Do I need to keep ETH in my wallet at all times? Yes. Every operation—depositing, withdrawing, opening, closing—requires submitting a transaction on Arbitrum, which requires paying ETH as gas. While Hyperliquid does not charge extra gas fees, cross-chain and deposit operations still incur Arbitrum network costs. It's recommended to keep 0.003-0.005 ETH in your wallet at all times.
What to do next:
Open your wallet and confirm you have a USDC balance and ETH balance on the Arbitrum network. Then, follow steps 2 and 3 to connect your wallet and deposit a small amount (e.g., 100 USDC). Don't open a large position right away; treat it as a simulation and place a small order to walk through the whole process: "Open position → Set TP/SL → Close position." After completing this cycle, you'll develop a real feel for Hyperliquid's rhythm. Once this small test trade is done, you can decide whether to increase your investment based on your own judgment.
