Hyperliquid's HYPE token fell to a seven-month low after the market reacted to a sharp decline in the protocol's dominance and renewed concerns over recent token movements.
According to BeInCrypto data, the token fell more than 4% in the last 24 hours to $29.24, the lowest level since May.
Why is HYPE's price falling?
CoinGlass data showed that the drop triggered more than $11 million in liquidations, adding to the pressure on a market that was already cautious.
The change marks a strong reversal for a protocol that once dominated the on-chain perpetual market. Earlier this year, Hyperliquid dominated the decentralized perpetual market with nearly total control. However, that advantage has faded.
Data from DeFiLlama reveals a staggering erosion of its dominance, with the protocol's share of the perpetual market crashing from a peak of nearly 70% to less than 20% at press time.
This can be linked to the emergence of more aggressive rivals, such as Aster and Lighter, which have succeeded in siphoning volume through superior incentive programs.
As a result, investors quickly reassess HYPE and no longer see it as the sector's inevitable winner, but as a legacy that bleeds users.
At the same time, internal token movements have shaken confidence.
Blockchain analysis firm Lookonchain reported last month that team-controlled wallets unstaked 2.6 million HYPE, valued at approximately $89 million.
While the team restaked about 1.08 million tokens, the market focused on the outflows.
A total of 900,869 HYPE remained liquid in the wallet, and an additional 609,108 HYPE, worth approximately $20.9 million, was moved to Flowdesk, a prominent market player. The project also sold an additional 1,200 tokens for about $41,193 in USDC.
These events have had a psychological impact on the community.
As a result, HYPE has lost nearly 30% of its value over the past 30 days, ranking as the worst-performing asset among the 20 largest digital currencies by market capitalization.
With this in mind, crypto traders have become significantly bearish on the token. Crypto trader Duo Nine has suggested that the token's value could fall as low as $10.
"Mentally prepare for such a scenario if you want to survive what is coming," stated the analyst.
