a16z invested $356 million to aggressively acquire HYPE, surpassing Paradigm to become the largest external holding institution
Author: Zhou, ChainCatcher
On May 21, HYPE broke through $59, reaching a new high since September 2025, with a 24-hour increase of over 20% and a market capitalization of nearly $15 billion, ranking 11th globally.
According to Santiment analysis, short squeeze and ETF capital inflow are the direct triggers of this market trend.
In recent days, a large number of traders have bet on HYPE's decline, leading to a significant surge in negative funding rates across trading platforms. As prices continued to rise, bearish traders were forced to buy back positions, further pushing up prices. Currently, HYPE's open contracts remain at a high of over $1.92 billion, with new traders continuously entering the market, keeping the position size stable.
Meanwhile, the ETF channel has simultaneously amplified capital inflow. According to SoSoValue data, two U.S. spot ETFs tracking Hyperliquid (21Shares' THYP and Bitwise's BHYP) saw a total net inflow of about $22.3 million in their first week, with over $25.46 million net inflow recorded in a single day yesterday.
Analysts state that in the first six trading days, the net inflow adjusted for market capitalization of the two Hyperliquid ETFs was stronger than that of Bitcoin ETFs on three days and stronger than Ethereum ETFs on five days. Among them, Bitwise announced that 10% of the management fee for BHYP would be used to continuously buy and stake HYPE on the company's balance sheet.
It is noteworthy that in the past three days, a16z, Goldman Sachs, Grayscale, and Galaxy Digital have almost simultaneously taken action, and the largest external holding institution of HYPE has quietly completed a handover.
According to on-chain analyst Ai Yi's monitoring, a16z began a large-scale accumulation mode in August 2025, accelerating its pace this year. Currently, it has accumulated 9.18 million HYPE, valued at about $356 million, with an average price of $38.77. The holdings are dispersed across dozens of addresses, most of which are in a staked state, making it the largest external holding institution of HYPE, surpassing Paradigm, which had long occupied this position.
In the past 24 hours, a16z withdrew 2.597 million HYPE from major exchanges at an average price of $51.17, with an unrealized profit of over $79 million, and it has not stopped increasing its position.
Other institutions are also taking action intensively. Goldman Sachs recently sold over $152 million in XRP, $500 million in ETH, and $450 million in BTC, turning to buy HYPE; Grayscale-related addresses have bought and staked about $24.95 million in HYPE in the past week, with an additional increase of about $12.1 million in the last 17 hours. Grayscale submitted an S-1 registration application for a HYPE spot ETF in January this year.
Additionally, Galaxy Digital's associated wallet bought about $8.8 million worth of HYPE in the last two hours; insider whale agent Garrett Jin also deposited $10 million USDC into Hyperliquid to directly buy HYPE.
Bitwise Chief Investment Officer Matt Hougan recently characterized HYPE as one of the "most mispriced" assets in the current crypto market. He believes the market is still pricing HYPE within the framework of perpetual contract DEX tokens, while Hyperliquid's true scale has far exceeded this framework, with nearly half of the platform's trading volume related to non-crypto assets, covering various asset classes such as commodities, stock indices, RWA, and even prediction markets.
Supporting this judgment is the real income generated by the Hyperliquid protocol itself. The platform channels 97% of its fee income into the Assistance Fund, continuously buying and burning HYPE in the open market, with cumulative buybacks exceeding $2.49 billion since 2025, accounting for 46% of the total buyback in the industry.
On-chain data shows that Hyperliquid recently accounted for over 42% of the total blockchain transaction fee income.
The sources of income are also continuously expanding. After Coinbase partnered with Circle as the USDC treasury capital deployment party, the AQAv2 upgrade was activated, and it is expected that USDC reserve income will add about $440,000 in buyback potential to the protocol daily.
In terms of RWA, after the launch of HIP-3, the trading volume of perpetual contracts for commodities such as oil, gold, and silver has continued to explode, with the daily trading peak of crude oil perpetual contracts exceeding $2.2 billion during the Iran conflict.
Currently, the RWA perpetual open contracts on the Hyperliquid platform have risen to a historical high of $2.6 billion, doubling from two months ago. The total number of users has reached 1.2 million, with a total trading volume of $4.33 trillion, accounting for about 70% of the on-chain perpetual DEX market share.
In the prediction market aspect of HIP-4, Hyperliquid officially launched its prediction market function in May this year, with the first BTC price direction binary contract's daily trading volume being about three times that of the combined markets of Polymarket and Kalshi. ChainCatcher has provided a detailed analysis in “Can Hyperliquid Win in the Prediction Market?”.
Recent data from Polymarket shows that the market bets an 80% probability that HYPE will reach $66 by the end of 2026, a 46% probability of reaching $80, and a 32% probability of reaching $100.
Previously, BitMEX co-founder Arthur Hayes publicly called for HYPE, stating that it is expected to reach $150 before August. Today, he reiterated on social media that HYPE is getting closer to its historical high.
Hayes' Maelstrom fund has previously sold off holdings such as ENA, PENDLE, and ETHFI, turning to increase its position in HYPE. According to HyperInsight monitoring, Arthur Hayes currently holds 247,334 HYPE, valued at $14.5 million, with an unrealized profit of over $6.5 million.
However, Hyperliquid's rapid expansion has also brought troubles. Especially after the launch of HIP-3, the trading volume of on-chain commodity contracts quickly encroached on the weekend and after-hours trading periods of traditional exchanges, directly treading on Wall Street's interests.
Recently, CME and ICE have joined forces to pressure the U.S. CFTC to require Hyperliquid to register and accept regulation, believing that its anonymous, year-round trading environment may distort global oil price benchmarks.
At the same time, according to Hyperinsight's on-chain monitoring, two addresses marked as mainstream market makers on Hyperliquid withdrew nearly 90% of BTC and ETH liquidity during the same time period, with a total estimated withdrawal of nearly $100 million. ChainCatcher has provided a detailed analysis of this background in “Hyperliquid Disturbs Wall Street, Regulatory Uncertainty, Market Makers Run First?”.
As the price continues to rise, HYPE has achieved an increase of over 125% this year, with FDV once surpassing SOL, and operational risks can no longer be ignored. According to on-chain monitoring, some large holders have established short positions worth over $100 million while holding large amounts of HYPE spot positions for hedging.
The uncertainty on the regulatory front has not dissipated, and the CFTC's attitude towards Hyperliquid remains a variable hanging over. Beyond the long and short confrontation, this game regarding the boundaries of on-chain finance is also far from over.
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