<\/p>\n
If passed, HIP-5 would establish a second Hyperliquid assistance fund to bootstrap and support ecosystem tokens beyond HYPE.<\/p>\n
The Hyperliquid community is considering a new proposal, dubbed HIP-5,<\/a> that would establish a secondary assistance fund to support Hyperliquid ecosystem projects using a portion of the decentralized exchange\u2019s revenue.<\/p>\n One of the proposal\u2019s co-authors, Ericonomic, shared<\/a> the details on X and in the Hyperliquid Discord, but the idea of altering Hyperliquid\u2019s fee buyback mechanism has left the community split.<\/p>\n Currently, Hyperliquid uses 99% of its revenue to buy back HYPE tokens through its assistance fund. Under HIP-5, a second assistance fund (AF2) would be formed with up to 5% of total protocol fees allocated to buy back tokens from Hyperliquid\u2019s strict list, such as PURR, and upcoming ecosystem tokens from Kinetiq, Felix, and other HyperEVM protocols.<\/p>\n HYPE stakers would be able to vote to determine which ecosystem tokens to buy and in what quantities.<\/p>\n One user, known as Altoshi, responded on X and said, \u201crespectfully, I don\u2019t support this. Allocating fees to third-party projects may lead to bribery, and cabals milking money from the DAO; given the USDH voting process, this would lead to some groups using AF2 as the exit liquidity for their seed investments. This is exactly what happened to Cosmos $ATOM<\/a> and Polkadot $DOT<\/a>, cabals were milking the system.\u201d<\/p>\n Meanwhile, other HYPE holders voiced their support for the mechanism, claiming that it incentivizes builders and HYPE governance participation. Purrteil, an anonymous trader and Hyperliquid supporter, said<\/a>, \u201cThis is literally what I spoke about since TGE. Would love to see it happen!\u201d <\/p>\n