Hyperliquid's HYPE token dropped to its lowest level in seven months as the market reacted to a sharp decline in the protocol's dominance and renewed concerns about recent token movements.
According to BeInCrypto data, the token fell more than 4% in the last 24 hours to $29.24, the weakest level since May.
Why is the HYPE price falling?
CoinGlass data showed that the drop triggered over $11 million in liquidations, increasing pressure on a market that was already becoming cautious.
This change marks a clear turning point for a protocol that once controlled the on-chain perpetual market. Earlier this year, Hyperliquid dominated the decentralized market with almost total authority. But that advantage has diminished.
Data from DeFiLlama reveals a sharp erosion of its dominance, with the protocol's market share plummeting from a peak of nearly 70% to below 20% at the time of press.
This can be linked to the emergence of more aggressive competitors, such as Aster and Lighter, who have successfully attracted volumes through better incentive programs.
As a result, investors are quickly changing their view on the price of HYPE and no longer see it as the inevitable winner of the sector, but as a legacy power holder losing users.
At the same time, internal token movements have shaken confidence.
Blockchain analytics firm Lookonchain reported last month that team-controlled wallets unstaked 2.6 million HYPE, worth about $89 million.
While the team restaked about 1.08 million tokens, the market focused on the outflows.
A total of 900,869 HYPE remained in the wallet, and an additional 609,108 HYPE, worth about $20.9 million, was moved to Flowdesk, a prominent market maker. The project also sold an additional 1,200 tokens for about 41,193 USDC.
These events have had a psychological effect on the community.
As a result, HYPE has lost nearly 30% of its value over the past 30 days and ranks as the worst-performing asset among the 20 largest digital currencies by market cap.
In light of this, crypto traders have become significantly more negative about the token. Crypto trader Duo Nine has suggested that the token's value could fall as low as $10.
"Prepare yourself mentally for such a scenario if you want to survive what is coming," said the analyst.
