Why did the price of HYPE fall?
Hyperliquid (HYPE) dropped 2.99% in the last 24 hours, moving opposite to Bitcoin’s upward trend. The main reasons include rising competition, negative technical signals, and upcoming token unlocks that could increase supply.
- Aster’s Volume Surge (Negative Impact)
Aster, a competitor linked to Binance, gained over 50% market share by offering incentives, drawing traders away from HYPE. - Token Unlock Concerns (Negative Impact)
Starting November 29, large amounts of HYPE tokens will unlock, potentially adding $500 million worth of tokens monthly—more than what buybacks can handle. - Technical Weakness (Mixed Impact)
HYPE fell below a key support level at $49 and is now near important Fibonacci retracement levels between $47.44 and $44.19.
In-Depth Analysis
1. Competition from Aster (Negative Impact)
Summary:
Aster, a decentralized exchange (DEX) supported by Binance, saw $345 million in trading volume within 24 hours of its token launch on October 3, 2025. This surge attracted traders who previously used HYPE. Analyst Patrick Scott from CryptoTimes points out that Aster’s growth is mainly due to short-term rewards like airdrops, but HYPE still holds 62% of the open interest in the market.
What this means:
Although Hyperliquid has strong fundamentals—like a profitable business model and a price-to-sales ratio of 12.6—traders are shifting toward riskier, higher-reward options like Aster. HYPE’s 24-hour trading volume dropped nearly 49% to $350.8 million, indicating less speculative trading.
What to watch:
Aster’s ability to keep traders after its incentives end (expected mid-October) will show if its growth is sustainable.
2. Upcoming Token Unlocks (Negative Impact)
Summary:
Starting November 29, 2025, about 237.8 million HYPE tokens (valued at $11.9 billion at $50 per token) will gradually unlock over two years. Hyperliquid’s current buyback program, funded by daily fees of $8.32 million and a 97% buyback rate, can only absorb about 17% of this new supply.
What this means:
Even with strong daily revenue, the market could see a net increase of $410 million worth of HYPE tokens each month. This extra supply might push prices down unless demand grows significantly. Traders are already reacting to this uncertainty.
What to watch:
Governance proposals to reduce token unlocks—such as burning unissued tokens—are being discussed. Keep an eye on upcoming votes.
3. Technical Analysis (Mixed Impact)
Summary:
HYPE’s price fell below its 50-day simple moving average (SMA) of $50.20 and the 23.6% Fibonacci retracement level at $54.83. Indicators like the MACD histogram (-0.043) and RSI (51.8) suggest bearish momentum.
What this means:
If HYPE stays below $47.44 (the 38.2% Fibonacci level), it could drop further to $44.19 (50% Fibonacci level). However, the 200-day exponential moving average (EMA) at $37.73 offers strong long-term support.
What to watch:
If HYPE can climb back above $49.72 (50% Fibonacci level), it would weaken the bearish outlook.
Conclusion
The recent dip in Hyperliquid’s price reflects a combination of competitive pressure, concerns about upcoming token unlocks, and technical weaknesses. Despite these challenges, Hyperliquid’s core strengths—like holding 70% of the decentralized perpetual contracts market and $3.56 billion in total value locked (TVL)—remain solid. Traders are cautious as the November unlock date approaches.
Key points to monitor:
Will HYPE hold above $47.44, or will profit-taking push it down to $44.19? Also, watch Aster’s trader retention after incentives end and whether Hyperliquid’s trading volume recovers after the October 4 news cycle.
What could affect the price of HYPE?
HYPE’s price is caught between its strong position in decentralized finance (DeFi) and increasing competition.
- Perpetual DEX Competition (Mixed Effects)
Hyperliquid leads with 62% of open interest but faces challenges from new competitors like Aster. - HIP-3 Upgrade & USDH Growth (Positive Outlook)
New features and stablecoin adoption could boost fees and user activity. - Token Unlocks & Price Fluctuations (Potential Risks)
Most HYPE tokens are still locked, but future unlocks may increase selling pressure.
Deep Dive
1. Perpetual DEX Competition (Mixed Effects)
Overview:
Hyperliquid is the top decentralized exchange for perpetual futures, holding $1.7 billion in open interest, which is 62% of the market (Cryptotimes). However, competitors like Aster, supported by Binance, and Lighter are gaining ground. For example, Aster reached $345 million in daily trading volume shortly after launching, briefly surpassing Hyperliquid.
What this means:
Hyperliquid benefits from a loyal user base and strong profitability (its revenue is 12.6 times its market cap), which helps maintain stability. Still, aggressive promotions by competitors might temporarily pull liquidity away. Keeping its leading position depends on retaining traders once these incentives end.
2. HIP-3 Upgrade & USDH Growth (Positive Outlook)
Overview:
The upcoming HIP-3 upgrade, expected in late 2025, will allow users to create new markets by staking 500,000 HYPE tokens and earn half of the trading fees (RedStone). At the same time, Paxos has proposed managing USDH, Hyperliquid’s stablecoin, so that 95% of its yield goes toward buying back HYPE tokens, which could reduce the number of tokens available in the market.
What this means:
Sharing fees with users may attract more developers and increase activity within the Hyperliquid ecosystem. If USDH grows to a size similar to Tether (currently valued at $25 million), the buyback program could push HYPE’s price higher, similar to how Binance Coin’s burn mechanism works.
3. Token Unlocks & Price Fluctuations (Potential Risks)
Overview:
Only 27% of HYPE’s total supply of 1 billion tokens is currently available for trading. Tokens held by the core team (23.8%) will unlock between 2027 and 2028, while community rewards (38.8%) may gradually enter the market (Bitrue).
What this means:
In the short term, the limited number of tokens available can cause price swings—large trades, like an $18 million HYPE purchase in June 2025, have led to sharp price changes. Over the long term, as more tokens unlock, there is a risk of price dilution unless demand grows faster than supply.
Conclusion
HYPE’s future depends on balancing its innovative DeFi features with market risks. Its strong position in perpetual futures trading and the growth of USDH are positive signs. However, competition and upcoming token unlocks require careful monitoring. The key question is: Will Hyperliquid’s revenue (currently $1.1 billion annually) keep up with the increase in token supply after 2027? Watching quarterly buybacks and how widely HIP-3 is adopted will provide important insights.
What are people saying about HYPE?
Hyperliquid’s HYPE token is gaining attention thanks to big investors making large bets, positive technical signals, and strong revenue growth—but some caution remains about possible overenthusiasm. Here’s the latest:
- Big investors at odds – $4.75 million in long positions vs. $2.07 million in shorts, both using 10x leverage
- Technical optimism – Analysts expect $70-$80 if HYPE breaks through $60 resistance
- Revenue-driven hype – 97% of fees are used to buy back tokens, creating ongoing buying pressure
Deep Dive
1. @cryptonary: Bullish breakout points to higher prices 🚀
"HYPE turned bullish above $49, with targets of $70-$80 by the end of 2025 if support holds at $52-$53. The RSI breakout matches the huge 1,403% rally seen in 2024."
– @cryptonary (189K followers · 2.1M impressions · 2025-09-13 21:06 UTC)
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What this means: Technical indicators and momentum suggest prices could keep rising if key support levels hold. However, the Relative Strength Index (RSI) is near overbought levels (69), which could mean a short-term pause or pullback.
2. @CoinRank_io: Arthur Hayes’ 126x upside projection sparks debate 🔥
"Arthur Hayes predicts a $10 trillion stablecoin market, leading to $25.8 billion in annual fees for HYPE. At a 0.03% fee rate, the current fully diluted valuation implies a 5x upside to fair value."
– @CoinRank_io (62K followers · 890K impressions · 2025-08-25 04:22 UTC)
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What this means: The bullish case depends on Hyperliquid capturing about 26% of the stablecoin market volume—a very optimistic assumption. This could be challenged by competition from centralized exchanges or regulatory changes.
3. @0xMojojo: Warning signs of an overcrowded trade ⚠️
"HYPE at $57 feels overbought—similar to the peak of SOL in 2021. Monthly fee buybacks of 0.7% can’t stop big investors from taking profits indefinitely."
– @0xMojojo (38K followers · 420K impressions · 2025-09-13 16:44 UTC)
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What this means: Some analysts warn that retail investors’ fear of missing out (FOMO) resembles past market tops. Exchange data shows net outflows of $13.9 million on August 27, indicating selling pressure despite buybacks.
Conclusion
Most experts are optimistic about HYPE’s technical setup and strong fundamentals, but opinions differ on whether the current valuation is too high. The protocol generates $3.7 million in daily revenue, and HyperEVM adoption has reached $2 billion in total value locked (TVL), supporting a premium price. Still, with a price-to-sales (P/S) ratio of 12.6, there’s little room for mistakes. Keep an eye on the $52-$53 support level and rumors about listings on major exchanges like Binance or Coinbase—these could either boost the price further or trigger a sell-the-news reaction.
What is the latest news about HYPE?
Hyperliquid is facing growing competition in the decentralized finance (DeFi) space, but experts still see it as a market leader. Here are the key updates:
- Perpetual DEX Competition Heats Up (October 4, 2025) – New competitor Lighter reaches $1 billion in total value locked (TVL), challenging Hyperliquid’s lead in derivatives trading.
- Analyst Supports HYPE Despite Volume Drop (October 3, 2025) – Patrick Scott highlights Hyperliquid’s strong market share and profitability.
- ARK CEO Compares HYPE to Solana’s Growth (October 3, 2025) – Cathie Wood draws parallels between Hyperliquid’s early growth and Solana’s breakout in 2021.
Deep Dive
1. Perpetual DEX Competition Heats Up (October 4, 2025)
Overview: Lighter, a Layer-2 decentralized exchange (DEX) for perpetual contracts, has quickly grown to over $1 billion in TVL just six months after launching. It joins other competitors like Aster and Hyperliquid in a crowded market. Hyperliquid still leads with $279.7 billion in trading volume over the past 30 days. Aster, supported by Binance, briefly captured half the market by offering aggressive incentives.
What this means: In the short term, increased competition might reduce Hyperliquid’s trading fee income. However, Hyperliquid’s strong profitability—measured by a revenue-to-market cap ratio of 12.6—and loyal user base could help it maintain its leadership position over time. (CryptoTimes)
2. Analyst Supports HYPE Despite Volume Drop (October 3, 2025)
Overview: Although Hyperliquid lost 45% of its trading volume to Aster, it still controls 62% of the open interest in perpetual DEX contracts. Analyst Patrick Scott believes this reflects real user engagement after initial incentives ended, unlike competitors who rely heavily on temporary rewards.
What this means: Dominance in open interest shows traders trust Hyperliquid’s liquidity and platform stability. With only 27% of Hyperliquid’s tokens currently circulating, the token’s design could create scarcity if demand grows faster than new tokens are released. (CryptoTimes)
3. ARK CEO Compares HYPE to Solana’s Growth (October 3, 2025)
Overview: Cathie Wood, CEO of ARK Invest, compared Hyperliquid’s early adoption to Solana’s rapid rise in 2021, highlighting its potential impact on decentralized derivatives markets. While ARK has not confirmed any investments in Hyperliquid, the comparison signals growing institutional interest.
What this means: This analogy could attract speculative investors, although Hyperliquid’s $16 billion market cap already reflects its leadership status. Regulatory developments around DeFi derivatives will be important to watch. (CoinTelegraph)
Conclusion
Hyperliquid is facing tougher competition but still holds key advantages in derivatives liquidity and token economics. While short-term volatility may continue as new rivals enter the market, Hyperliquid’s profitability and strong open interest position suggest it can remain resilient. The growth of its HyperEVM ecosystem might also help address concerns about centralization as more validators join.
What is expected in the development of HYPE?
Hyperliquid’s roadmap is focused on growing its ecosystem and bringing new innovations to decentralized finance (DeFi).
- HIP-3 Permissionless Markets (Q4 2025) – Developers will be able to create new markets by staking HYPE tokens, which helps generate more fees.
- USDH Stablecoin Expansion (2025) – The native stablecoin USDH will grow, with 95% of reserve interest used to buy back HYPE tokens.
- HyperEVM Ecosystem Growth (2025–2026) – Adding Ethereum compatibility to support more DeFi apps and developers.
Deep Dive
1. HIP-3 Permissionless Markets (Q4 2025)
Overview:
HIP-3 is a proposal that lets developers launch new perpetual markets by locking up 500,000 HYPE tokens. This allows anyone to list assets without needing permission, encouraging decentralization. Developers who create these markets can earn up to 50% of the trading fees (RedStone blog).
What this means:
This is positive for HYPE because staking tokens reduces the number available on the market, which can increase value. Plus, new markets bring in more fees for the platform. However, there’s a risk if not enough developers participate or if the new markets don’t attract enough trading activity.
2. USDH Stablecoin Expansion (2025)
Overview:
USDH is Hyperliquid’s own stablecoin designed to maintain a stable value. It uses 95% of the interest earned on reserves to buy back HYPE tokens, supporting their price. Partnerships with companies like Paxos and Frax Finance aim to improve how USDH earns yield and stays backed by assets (HYPERDailyTK).
What this means:
If USDH becomes widely used, it could increase demand for HYPE through these buybacks. On the downside, stablecoins face regulatory challenges, and USDH will compete with well-established stablecoins like USDC.
3. HyperEVM Ecosystem Growth (2025–2026)
Overview:
HyperEVM is a new layer compatible with Ethereum, allowing developers to build apps that work across different blockchains. More than 180 teams are already building on it, including lending platforms like HyperLend and yield vaults like Hyperbeat (DU09BTC).
What this means:
This development could increase the usefulness of HYPE by attracting more developers and users. Success depends on how well HyperEVM works with other blockchains such as Solana and Arbitrum.
Conclusion
Hyperliquid’s roadmap aims to balance decentralization (through HIP-3), stablecoin growth (USDH), and expanding its developer ecosystem (HyperEVM). Key risks include potential centralization of validators and regulatory issues. The big question is whether Hyperliquid’s focus on builders will help it outpace competitors like Aster.
What updates are there in the HYPE code base?
Hyperliquid’s latest software updates focus on making the platform more flexible, secure, and user-friendly.
- Rabby Builder Code Integration (Sept 4, 2025) – Allowed other apps to connect directly to Hyperliquid’s liquidity pool.
- HIP-3 Auction Mechanism (Aug 21, 2025) – Made it easy for anyone to create new markets with shared fees as incentives.
- HyperSwap UX Overhaul (Sept 4, 2025) – Simplified cross-chain trading and improved liquidity management.
Deep Dive
1. Rabby Builder Code Integration (Sept 4, 2025)
What happened: Hyperliquid teamed up with Rabby Wallet to let any app or website access its trading liquidity through “Builder Codes.” These are modular tools that let developers create custom trading experiences—like Telegram bots or mobile apps—without needing to manage liquidity themselves. Rabby Wallet’s 2 million+ users can now trade Hyperliquid perpetual contracts directly inside their wallet.
Why it matters: This is great news for Hyperliquid (HYPE) because it expands the platform’s reach without cutting into the fees that support HYPE token buybacks. Traders get a smoother experience with consistent liquidity across different platforms.
(Source)
2. HIP-3 Auction Mechanism (Aug 21, 2025)
What happened: HIP-3 introduced a new system where anyone can create their own trading markets by staking 1 million HYPE tokens. Market creators can earn up to 50% of the trading fees. This lets developers launch custom perpetual markets—like tokens before they officially launch or stock derivatives—with adjustable fees and leverage. Over 180 teams tested this in August, including Ethena Labs (USDe perpetual contracts) and Hyperunit (leveraged stock markets).
Why it matters: In the short term, this might limit HYPE token availability because of staking requirements. But long term, it’s a positive move since sharing fees could attract specialized markets, increasing overall revenue for the platform.
(Source)
3. HyperSwap UX Overhaul (Sept 4, 2025)
What happened: HyperSwap’s interface was redesigned to support easy, one-click swaps across 30+ blockchains. It also combines liquidity from partners like PRJX, Ramses, and Hyperpie. This update reduced price slippage by 37% on large trades (according to Dune Analytics) and added live yield information for liquidity providers.
Why it matters: This upgrade makes trading smoother and more attractive, especially for everyday users switching from centralized exchanges like Coinbase. It’s a strong positive for HYPE’s growth.
Conclusion
Hyperliquid’s recent updates focus on growing the ecosystem (Builder Codes), opening new market opportunities (HIP-3), and improving user experience (HyperSwap). Since 97% of trading fees go toward buying back HYPE tokens, these improvements support both technical progress and token value. Looking ahead, the planned integration of zk-proof technology with HyperEVM in late 2025 could further strengthen Hyperliquid’s position in decentralized finance (DeFi).