HYPE Price Prediction: Should You Buy While Price is Low?

The sentiment around Hyperliquid’s HYPE token has shifted sharply as the once-dominant perpetuals DEX loses its market share and investor confidence. Once viewed as the unstoppable leader of on-chain perps, Hyperliquid is now experiencing structural pressure from competitive protocols, liquidity migration, and team-linked token movements that have unsettled the market.

With HYPE falling to a seven-month low and analysts warning of a potential decline toward $10, many traders are asking whether this downturn presents a buying opportunity or a sign of deeper trouble ahead. This article examines market conditions, dominance trends, token flows, and potential scenarios to determine where HYPE may be headed next.

Key Takeaways

• HYPE dropped to $29.24, its lowest price since May.
• Hyperliquid’s market share collapsed from nearly 70% to under 20%
• More than $11M in liquidations added pressure during the sell-off.
• Team-linked wallets unstaked 2.6M HYPE, valued at about $89M.
• Around 609,108 HYPE was sent to Flowdesk, causing further concern.
• Market sentiment is increasingly bearish, with some analysts expecting a drop toward $10.
• Rival DEXs like Aster and Lighter are taking significant volume from Hyperliquid.

HYPE Falls to its Weakest Level in Seven Months

HYPE has dropped more than 4% in the past 24 hours, trading near $29.24 at the time of writing. This decline extends a month-long sell-off during which the token shed nearly 30% of its value. The bearish trend reflects a broader deterioration in Hyperliquid’s positioning as traders reassess which decentralized exchanges will dominate the next cycle.

The sell-off coincides with declining confidence in the protocol’s long-term trajectory, especially as liquidity shifts toward newer DEXs offering aggressive incentives and innovative structures.

Read Also: Hyperliquid HYPE Rebounds 68%

Hyperliquid’s Market Share Collapse Signals Structural Weakness

The most alarming indicator is the collapse in Hyperliquid’s market dominance. Months ago, Hyperliquid controlled nearly 70% of the on-chain perpetuals market. Today, that share has fallen to below 20%.

This dramatic erosion suggests several trends.

• Liquidity providers are migrating to competitors.
• Users are responding to incentive programs from rivals like Aster and Lighter.
• The perception of Hyperliquid as the default perps platform is weakening.

A decline of this magnitude rarely occurs without deeper competitive or structural issues. It implies that the market no longer views Hyperliquid as the inevitable winner but as one incumbent among many.

Liquidations Add Fuel to the Downtrend

According to CoinGlass data, the latest downward move triggered more than $11M in liquidations. This forced selling accelerates existing price declines by pushing leveraged traders out of positions. When liquidations accumulate near major support zones, they often amplify volatility and drag the price lower than expected.

Given the sharp correction and weakening dominance, traders who once saw HYPE as a strong long-term asset are now reducing exposure or rotating into emerging DEX tokens.

Token Movements From Team-Linked Wallets Hurt Confidence

One of the largest contributors to negative sentiment is the movement of more than 2.6M HYPE tokens from team-controlled wallets. The unstaking event, valued at approximately $89M, immediately raised questions about potential sell pressure or liquidity reshuffling.

Breakdown of the movement includes:

• 1,088,822 HYPE restaked
• 900,869 HYPE kept liquid in the wallet
• 609,108 HYPE sent to Flowdesk
• 1,200 HYPE sold for around $41K in USDC

Although the majority of tokens were restaked or held, the outflows intensified market anxiety. Flowdesk’s involvement adds another layer because market makers often manage liquidity for active trading.

Even without a confirmed sell-off, the perception alone was enough to accelerate bearish positioning.

Competition Is Reshaping the Perpetuals Landscape

Hyperliquid is no longer the sole leader in decentralized perps. Competitors like Aster and Lighter have captured significant volume through:

• Aggressive incentive programs
• Better user acquisition strategies
• Stronger liquidity mining structures
• More active community engagement

As users migrate, network effects weaken. A perps DEX thrives on deep liquidity and active traders, and once these begin to decline, restoring dominance becomes difficult.

This shift explains why market participants are reevaluating HYPE’s long-term value.

Short-Term Market Sentiment Turns Bearish

Given the sharp dominance decline, token movements, and liquidations, traders have shifted to a cautious stance. Analysts warn that if downward momentum continues, HYPE may revisit lower levels that have not been tested since early 2024.

One trader, Duo Nine, suggested a potential drop toward $10 if market conditions do not stabilize. This scenario reflects a belief that HYPE’s value may still be inflated relative to the protocol’s shrinking market impact.

While bearish projections are not guarantees, they align with market behavior observed in declining incumbents across previous cycles.

What Needs to Happen for HYPE to Recover?

A sustainable recovery requires several conditions to improve simultaneously.

Rebuilding Market Share

Hyperliquid must regain a meaningful share of perpetuals volume. Without stronger liquidity and trading activity, the token struggles to justify higher valuations.

Restoring Community Trust

Transparency around token movements and staking actions is essential. Clear communication reduces uncertainty and discourages fear-driven selling.

Introducing Competitive Incentives

Other DEXs are pulling liquidity through incentive programs. Hyperliquid may need to refresh its incentive models to attract trading volume back.

Demonstrating Product Innovation

To remain relevant, Hyperliquid must show that it can innovate faster than competitors. This includes new features, better user flows, and improved execution.

HYPE Price Prediction: Bullish, Neutral, and Bearish Scenarios

The next few weeks are crucial. Here are three potential scenarios based on current market data.

Bullish Scenario

If Hyperliquid stabilizes market share and negative sentiment fades:

• HYPE could reclaim the $35 to $40 zone.
• Liquidation pressures may ease.
• Confidence may return as volume improves.

This scenario requires strong protocol updates and reduced team-wallet activity.

Neutral Scenario

If conditions remain unchanged:

• HYPE may consolidate between $25 and $32.
• Market share may fluctuate but remain low.
• Traders adopt a wait-and-see approach.

Neutral outcomes are common during transitional phases.

Bearish Scenario

If dominance continues falling and confidence weakens:

• HYPE could drop toward $20 and possibly $10.
• Liquidity may flow to competitors.
• Token unlocks or team movements may amplify selling.

This is the scenario many traders fear but is not yet confirmed.

Final Thoughts

HYPE is entering a pivotal moment as Hyperliquid loses its dominant position in the decentralized perpetuals market. The sudden collapse in market share, paired with large token movements from team-linked wallets, has triggered a shift in sentiment that may take time to rebuild.

While the price decline may look like a buying opportunity, it also reflects deeper structural challenges. Traders should weigh both the competitive pressures and the protocol’s future roadmap before deciding whether HYPE is undervalued or still has room to fall.

For now, HYPE sits in a fragile zone. A recovery is possible, but only if Hyperliquid can regain trust, rebuild liquidity, and compete effectively against fast-rising rivals.

Read Also: Hyperliquid Just Passed GMX in Open Interest – Here's Why

FAQs

Why is HYPE falling?

HYPE is declining due to collapsing market share, liquidations, and token movements from team-linked wallets.

How much did Hyperliquid unstake?

Team-linked wallets unstaked about 2.6M HYPE, valued near $89M.

Could HYPE drop to $10?

Some analysts believe it is possible if market share continues falling and sentiment does not improve.

Who is taking Hyperliquid’s market share?

Protocols like Aster and Lighter are capturing volume through incentives and competitive liquidity strategies.

Is this a good time to buy HYPE?

It depends on your risk tolerance. The price is low, but market conditions remain uncertain and bearish.