The Daily: Hyperliquid tests prediction markets, Solana-based DEX aggregator Jupiter integrates Polymarket, and more

The following article is adapted from The Block’s newsletter, The Daily, which comes out on weekday afternoons.

Happy Monday! As bitcoin closes four consecutive months in the red, Bernstein analysts see the current “short-term crypto bear cycle” reversing in 2026, with bitcoin likely bottoming around prior cycle highs in the $60K range before what they call the “most consequential” next cycle.

In today’s newsletter, Hyperliquid tests a prediction market feature, Jupiter integrates Polymarket, Japan’s Nomura cuts its crypto exposure following losses, and more.

Meanwhile, an investment vehicle backed by a UAE Sheikh reportedly acquired 49% of Trump’s World Liberty Financial days before his inauguration. Plus, Michael Saylor’s Strategy bought another 855 BTC for $75 million as its total bitcoin holdings briefly slipped underwater.

P.S. Don’t forget to check out The Funding, a biweekly rundown of crypto VC trends. It’s a great read — and just like The Daily, it’s free to subscribe!

Hyperliquid tests ‘Outcomes,’ moving into booming prediction markets

Hyperliquid is adding a new “Outcomes” feature on testnet as part of its HIP-4 upgrade, which aims to expand the protocol beyond perpetuals trading into prediction markets and limited-risk options.

• The Outcomes framework introduces fully collateralized, bounded contracts that behave like binary options without leverage, margin calls, or liquidation risk, the team said Monday.
• The rollout lands as prediction markets surge in popularity, with exchanges like Coinbase and Gemini eyeing competition with Polymarket and Kalshi.
• Outcomes will settle in Hyperliquid’s USDH stablecoin and run on HyperCore, the protocol’s high-performance execution engine.
• The move reflects rising user demand for safer, more flexible event-driven trading products, the team noted.
• Hyperliquid is building on strong momentum, recently setting an all-time high for open interest.

Solana-based DEX aggregator Jupiter integrates Polymarket

Continuing on the same theme, Jupiter has integrated Polymarket, bringing onchain prediction markets directly to the Solana-based DEX aggregator for the first time.

• The integration positions Jupiter as a potential hub for prediction markets on Solana by pairing its DEX infrastructure with event-based trading.
• Polymarket has emerged as one of the most active prediction platforms, offering markets spanning politics, macroeconomic events, sports, and culture.
• Despite strong competition from Kalshi, Polymarket’s volumes continue to surge, posting $7.7 billion in January as interest in trading event contracts accelerates.

Japan’s Nomura cuts crypto exposure following losses

Japan’s Nomura Holdings is cutting back crypto exposure after losses at its digital asset business weighed on quarterly earnings, Bloomberg reported.

• Nomura’s Swiss-based crypto arm, Laser Digital, posted losses amid market volatility from October to December, prompting tighter risk controls at the firm.
• The crypto pullback dragged Nomura’s quarterly net profit below expectations even as core operations remained resilient.
• Despite the setback, Nomura reiterated its long-term commitment to the digital asset sector, describing it as a promising area for future growth, while announcing a ¥600 billion ($38.7 billion) share buyback to support its stock.

Zama launches token, debuts privacy metric after more than $121 million shielded on Ethereum

Zama launched its ZAMA token, claiming the first production-scale deployment of fully homomorphic encryption on the Ethereum mainnet.

• The launch introduced a privacy metric, Total Value Shielded (TVS), after more than $121 million in value was encrypted during Zama’s sealed-bid token auction.
• Over 11,000 participants took part in the FHE-powered auction, pushing demand to exceed available supply by 218% while keeping bids and strategies confidential onchain.
• Zama positions TVS as a privacy-native analogue to DeFi’s TVL as it pushes its broader “HTTPZ” vision to make encrypted computation standard across blockchain applications.

Crypto funds extend exodus with another $1.7 billion in weekly outflows as ‘investor sentiment deteriorates’: CoinShares

Global crypto investment products logged another $1.7 billion in net outflows last week, flipping year-to-date figures to a $1 billion net outflow as investor sentiment weakened, according to CoinShares.

• U.S.-listed Bitcoin and Ethereum products led the retreat, with Bitcoin funds alone shedding $1.32 billion, driven by macro pressure, whale selling, and a more hawkish Federal Reserve backdrop, Head of Research James Butterfill said.
• A small pocket of investors positioned defensively, sending inflows into short Bitcoin funds, while Hype-linked products also saw inflows even as broader crypto prices slid.

In the next 24 hours

• It’s quiet on the economic calendar front.
• U.S. FOMC members Thomas Barkin and Michelle Bowman will speak at 8 a.m. and 9:40 a.m. ET, respectively, on Tuesday.
• Hivemapper is among the crypto projects set for token unlocks.

Never miss a beat with The Block’s daily digest of the most influential events happening across the digital asset ecosystem.

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