Research Report$HYPE ‌ Core Logic of Future Development

The future growth of HYPE depends on whether the platform can continue to generate profits and use that money to buy back tokens. Holding HYPE essentially means benefiting from the platform's revenue. This is somewhat similar to $BNB .

The real value of HYPE isn't in the token itself but in the large amount of user funds accumulated on the platform. As long as the money is there, people are there, trading is happening, and transaction fees are generated. Essentially, it's like a platform token for a decentralized exchange. Currently, the leading platform token for centralized exchanges is BNB, while for decentralized exchanges, it's HYPE. The only difference is that centralized exchanges have reached a bottleneck after years of development, whereas decentralized exchanges still have significant growth potential.

Looking at the data, last year Hyperliquid processed approximately $1 billion in transaction fees and used part of that to buy back 8 million HYPE tokens. The current circulating market cap is roughly $10 billion.

Therefore, its current valuation is somewhat supported by a buyback mechanism. Especially in a bear market, when there’s little new capital entering, buybacks provide the most direct support.

When the market is down, the platform relies on its own profits plus buybacks to stabilize the price; once the market recovers and trading volume increases, the flexibility of this model will truly be demonstrated.

Another new growth point is that Hyperliquid and Polymarket share a core group of users—high-frequency, highly knowledgeable traders who generate large trading volumes on Polymarket and are also big position holders on Hyperliquid.

This user quality is very valuable because they have substantial funds and are committed to continuous trading and fee contribution.

In the future, Hyperliquid might develop its own prediction market. If successful, the valuation of the HYPE token could continue to rise.

In the short term, HYPE’s valuation is supported by buybacks; in the long term, the focus is on expanding trading activity and bringing more volume from centralized exchanges.

From a price perspective, considering building a position below $30 is reasonable, as HYPE will have significant unlocks in the second half of this year.