Hyperliquid Anticipates $316 Million Token Unlock

Hyperliquid Anticipates $316 Million Token Unlock – Investor Reactions Varied

Hyperliquid is gearing up for a significant token unlock on November 29th, involving $316 million in HYPE tokens. Market reactions are mixed, with some major investors expecting a decrease in price, while others remain optimistic about a potential rebound. This article examines the potential implications of this significant event in the crypto market.

Key Takeaways

The token unlock is set for November 29th, involving $316 million in HYPE tokens.
Opinions are mixed; large investors foresee a 10% decrease to $28, while other analysts anticipate a recovery to $30.
The HYPE team has unstaked $316 million in anticipation of the unlock.
Analyst Avseenko noted that most participants were either engaging in HYPE farming or shorting, with a lack of strong buying interest in the spot markets.
Data indicates that about 3.6% of HYPE's total circulation, or 10 million tokens, will be unlocked to support founders and team members.
The event is significant due to the project's previous success and the fear, uncertainty, and doubt (FUD) it has generated.

HYPE Source: Tokenomist

In the next two years, HYPE will see monthly unlocks. Investor Arthur Hayes warned that even with ongoing buybacks, there may be more than $400 million of excess supply, which could impede HYPE's market value.

Hyperliquid prepares for $316 mln unlock - Investors split on price reaction

Evaluating HYPE's Market Position

As of the writing of this article, HYPE was trading at $31.4, marking a 47% decline from its all-time high of $59.4. Investors are pricing in a potential 10% drop to $28 in anticipation of the upcoming unlock.

HYPE Source: Laevitas

According to options data, the $28 price level has seen high put option activity, suggesting that large investors expect HYPE to maintain above this threshold after the unlock. This level previously served as a breakout point during HYPE's strong recovery earlier this year, indicating that market participants hope it will act as a support level.

HYPE Source: HYPE/USDT, TradingView

Notably, HYPE has experienced substantial accumulation over the past week. CoinGlass data reveals that more HYPE tokens were withdrawn from exchanges than were deposited, a sign of increasing self-custody among investors, which is often viewed as bullish.

HYPE Source: CoinGlass

Overall, the mixed signals in accumulation and options positioning indicate a lack of consensus regarding the impact of the unlock on HYPE's price. One analyst, Teng Yang, stated, “In my opinion, the team might sell some tokens, but I think the effect will not be as drastic as people fear (e.g., OTC, slow drip). The situation appears to be more stable compared to a typical venture capital unlock.”