> For the complete documentation index, see [llms.txt](https://leveracc.gitbook.io/leveracc-docs/llms.txt). Markdown versions of documentation pages are available by appending `.md` to page URLs; this page is available as [Markdown](https://leveracc.gitbook.io/leveracc-docs/getting-started/background-and-problems.md).

# Background & Problems

## Industry pain points

* 🚫 Exchange restrictions: HyperLiquid's high leverage restrictions on perpetual contract transactions cannot meet users' needs for short-term high-risk and high-return.
* 🚫 User needs: Traders are eager to use high leverage (50-200 times) to capture opportunities brought by short-term market fluctuations.
* 🚫 Capital threshold: High-value positions require huge margins, while retail investors have limited funds and find it difficult to participate.

## Market size

* 📈 Trading volume: HyperLiquid accounts for 80% of the global decentralized cryptocurrency derivatives daily trading volume (≈ 10 b/day).
* 💡 Target users: High-frequency traders, institutional arbitrageurs, and leveraged speculators are the main target groups.

## HyperLiquid L1

HyperLiquid L1 shows breakthrough potential with its layered architecture

* HyperCore layer: 10,000 TPS and CEX-level trading depth, providing a zero-slippage execution environment for high-leverage strategies, while supporting spot and contract trading;
* HyperEVM layer: fully compatible with EVM's smart contract capabilities, supporting complex financial logic on-chain.
* Future: HyperLiquid will further improve the interoperability between Core and EVM, providing a wider range of imagination.
* HIPs-1&2: Support any token in the EVM layer to be directly transferred to the Core to form a trading pair, further expanding the boundaries of HL