Explainer
What is a house perp?
A perpetual futures exchange with no order book: every trade is against a shared house pot that pays winners from what losers put in.
The short version
On a normal perp exchange you trade against other people's orders in an order book. On a house perp, every trade is against the house: a pot of money held by smart contracts. When you lose, your loss goes into the pot. When you win, you're paid from it.
Why build an exchange this way?
- No market makers needed. A new market can open without anyone providing liquidity first.
- Prices come from a reference. Fills use an outside price (on Route, Hyperliquid's on-chain prices), so there's no spread or slippage from a thin book.
- Very high leverage is possible. Because positions don't need a counterparty's order, small margins can control large positions: up to 1,200× on Route.
The trade-offs, honestly
- Wins depend on the pot. A house can only pay what it holds. Route shows a payout factor (the share of a win a position can be paid) before you sign, and when the pot is short, wins queue in order.
- Latency is the enemy. If traders could act on prices the pot doesn't see yet, they'd drain it. House perps defend against that: Route holds orders a few seconds before they fill.
- Sizes are capped. Position and side limits keep one trade from risking the whole pot.
Where the token comes in
Several house perps mint a token to traders when they lose, as a record of what they fed the pot. On Route that token is HLT: minted only from losses, at most 100 billion ever, with no pre-mint. It's not a claim on the pot. See the paper for how it works.
House perps on Hyperliquid
Route and Papertrade are house perps on HyperEVM; Cardboard is one on Solana. Compare them side by side.
Questions
What is a house perp?
A perpetual futures exchange where every trade is against a shared pot held by smart contracts, instead of an order book of other traders.
Can a house perp run out of money?
A house can only pay what its pot holds. On Route, a win the pot can't fully cover is partly queued and paid in order as the pot refills, and a queued win may never be paid in full.