The HYPE token of Hyperliquid has crashed to its lowest level in seven months, as the market reacts sharply to a steep decline in protocol dominance and growing concerns about recent internal token movements.

According to data from Coinphoton, HYPE dropped more than 4% in the last 24 hours, falling to around $29.24—a level not seen since May.

📉 What’s Driving the HYPE Sell-Off?

Data from CoinGlass shows that this sharp downturn triggered over $11 million in liquidations, significantly increasing downside pressure in a market that had already turned cautious.

This breakdown marks a critical turning point for Hyperliquid. Earlier this year, the protocol was the undisputed leader in on-chain perpetual futures, once commanding nearly 70% market dominance.

However, according to DeFiLlama, Hyperliquid’s share of the decentralized perpetual futures market has now collapsed to below 20%.

Key reasons behind this loss of dominance:

Aster and Lighter have emerged as major competitors

These rivals attracted huge trading volume via more aggressive incentive programs

Liquidity and traders began migrating away from Hyperliquid

As a result, investors are now rapidly repricing HYPE, no longer viewing it as the sector’s strongest growth candidate—but rather as a former leader struggling to retain users.

🚨 Internal Token Transfers Add to Market Fear

On top of competitive pressure, on-chain data has raised serious community concerns.

Blockchain analytics firm Lookonchain recently reported that wallets controlled by the Hyperliquid team:

Unstaked 2.6 million HYPE, worth roughly $89 million

Although about 1.08 million HYPE was re-staked, the market focused heavily on the net outflows

Current on-chain status:

900,869 HYPE remains liquid in team-controlled wallets

609,108 HYPE (worth ~$20.9 million) was transferred to Flowdesk, a major market maker

The project also sold 1,200 HYPE, receiving about $41,193 USDC

These actions have significantly weakened market confidence, as traders fear potential large-scale distribution.

🩸 Worst Performer Among Top 20 Cryptos

Due to these combined factors:

HYPE is down nearly 30% over the past 30 days

It has become the worst-performing asset in the Top 20 by market cap

Bearish sentiment is now dominating short-term price action

Prominent trader Duo Nine even warned that:

> “HYPE could realistically fall as low as $10 if the current trend continues. Traders should mentally prepare for that scenario.”

📊 HYPE Trading Strategy (Educational Reference Only)

⚠️ This is NOT financial advice — for study purposes only.

✅ Current Structure:

Strong downtrend on H1–H4

Weak bounce attempts

Previous support at $30 has turned into resistance

🟢 Buy Setup (Speculative Rebound Trade)

Only for aggressive traders:

Buy zone: $27.0 – $28.2

Stop Loss: $24.8

Take Profit 1: $30.5

Take Profit 2: $33.8

Risk/Reward: ~1:2.5

✅ Only valid if price shows clear bullish confirmation (higher low + volume expansion).

🔴 Sell Setup (Trend-Following – Safer)

Preferred in current market conditions:

Sell zone: $30.5 – $31.8

Stop Loss: $34.2

Take Profit 1: $27.5

Take Profit 2: $23.0

Extended TP (if panic continues): $18 – $15

✅ Strong bearish continuation if $27 support breaks with volume.

🧠 Market Outlook Summary

Dominance collapse = structural weakness

Team token movements = trust risk

Volume leaving ecosystem = capital rotation

Technically and fundamentally, HYPE is still in distribution phase

Until: ✅ Market share stabilizes

✅ Team addresses token concerns transparently

✅ Liquidity incentives improve

➡️ HYPE remains high-risk in the short to mid term.

💬 Do you see this as a deep-value buying opportunity… or the start of a much larger breakdown?

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#HYPE #Hyperliquid #CryptoCrash