(Sorry, long post, bold text and last paragraph for the TL;DR)
So before I start this, let me just say I have been for the last year one of the staunchest defenders of the Hyperspace Format, and its ill-fated predecessor Second Edition Format.
Reasons I liked Hyperspace were myriad, and here's kind of the big three:
1.) Easier to get into for new players. This specifically applied to the Second Edition Format but early Hyperspace also largely followed this for most factions. Basically the idea is it looks bad for the game if people have to look to eBay to get the ships from a dead edition and then buy a conversion kit to get into the game, and that's also a costly buy-in.
2.) Easier to balance. With the same number of ships per faction, it's easier to balance. Period. If a faction like Scum has four times as much stuff as a faction like Separatists, then the scum ships all need to be worse because they're being balanced around combo-potential, and this all the scum ships seem bad because relatively anti-synergistic (not built around card-combo) scum lists will be depowered since the scum card combos are pretty much guaranteed to be more powerful (since number of card interactions grows exponentially when the number of cards grows).
3.) Inspires creativity. Trying to find your playstyle in a limited ship set can be fun. Personally I'm not as in to this one (I get bored quickly at the Battle of Yavin type custom format events) but I can see why it's fun. It's sort of like building with LEGO vs. building with bits of foam and glue. Less pieces to work with increases your creativity by imposing constraints.
So now we get to my problems.
The first one is with the first point I made - Hyperspace is no longer any better for new players. New players who want to play Scum will probably need a StarViper and conversion to get Guri, new players who play Rebels will need Cassian, Blue Squadron Scout, etc. for their U-Wings and probably want an A-Wing for Jake. New Empire players need Soontir. New FO and Resistance players will need a conversion for their large base ships. Separatists and Republic don't matter because they're also super easy for new players to get into in extended. This point is completely invalid now.
Next, we get to the second point . My problem is that the points and slots are exactly the same for both formats. The reason for this is that people want to play the same list in both formats and be decently competitive with it in both, but then why do both formats exist? The problem is that the points are balanced around extended. So there's a couple ways this can work out:
• The big factions are completely dominant in extended. With more combos and options, they're just better at building versions of the same list archetypes.
• The little factions are completely dominant in Hyperspace. With all their options vs. a small fraction of the other factions' options, they just do better in this format.
• The ships that are in extended but not Hyperspace are garbage. To balance both factions, Extended = Hyperspace + meme ships.
Right now we have some mixture of all three of these effects, which is slightly obscured by Republic and Empire being a lot better than the other factions in both formats, and we're looking at this as where the rebalance needs to occur rather than considering independently the balance of the two formats. Basically what I'm saying is that at least one of these unpleasant things is doomed to happen so long as Hyperspace and Extended use the same points, and therefore Hyperspace is a net detriment to game balance.
The final point is still here I guess. Hyperspace can be fun in a way if you and all your friends only play extended and only play the big factions, and so Hyperspace is some sort of meme format. The problem here is that there's too many ships in Hyperspace now and it stops feeling different. Nothing's actually been rotated out yet and already it feels like a mini-Extended, with Scum (for example) having way more ships and most of their ships are intentionally bad to allow faction balance.
Basically what I'm getting at is what I've been mad about for a long time: Hyperspace should be the competitive format, and extended a fun format for casual events. But the insistence on competitively balancing both using the same points and on adding people's favorite ships to Hyperspace all the time has made all of the reasons I liked Hyperspace irrelevant.
Unless things are aggressively removed from Hyperspace and points go over to a method where we have a sheet for each format and the points are different between formats, I cannot continue to support Hyperspace as a format because I just don't see how having these two formats with the current methods is improving the game. I'm not mad about the game, I think it's reasonably balanced and very fun, I just think that I've stopped believing in the two formats.