Hyperliquid (HYPE) is showing impressive momentum in 2026: the token has risen approximately 250% since the start of the year, starting in January at around $20.50. Currently, the asset is trading near $71.82, gaining 4.4% over the last 24 hours. Bulls are attempting to break the all-time high of $76.70 for the third time. However, despite powerful fundamental drivers, serious risks loom over the market that could reverse the uptrend.
Record Revenues and Institutional Inflows Create a Strong Bullish Foundation
The key catalyst for growth is the protocol's own economics. On June 30, Hyperliquid surpassed the $1 billion mark in cumulative revenue. The fee distribution mechanism is impressive: about 99% of all trading fees are directed towards buying back HYPE from the market through a specialized support fund. This creates constant, sustained demand.
Additionally, institutional investors are actively expanding their presence. In mid-May, the first spot ETFs for HYPE launched in the US — Bitwise BHYP and 21Shares THYP. The total net inflow into these funds exceeded $170 million by early July. Grayscale has also filed an S-1 application with the SEC to launch its own product. This combination of internal buybacks and external capital from ETFs creates an extremely favorable environment for the rally to continue.
The Flip Side: Unlocks and Regulatory Pressure
However, serious threats lurk behind the bullish facade. On July 6, an unlock of 9.92 million HYPE (equivalent to approximately $645 million at the time) occurred. Although the buyback fund held 4.6 times more funds, constant unlocks create permanent downward pressure on the price. Currently, only 22% of the total 1 billion token supply is in free circulation. Starting in 2027, new tranches for early project participants will be unlocked on the 6th of each month.
Regulatory pressure is also intensifying. In late June, the Monetary Authority of Singapore (MAS) added Hyperliquid to its list of companies with increased risk for retail investors. UK authorities have also issued similar warnings. Furthermore, according to Bloomberg, exchanges CME and ICE have called on the US CFTC to review the legality of listing the project's perpetual contracts. The emergence of this news triggered an immediate 6% drop in the HYPE price.
Technical Analysis: Volatility Squeeze Foreshadows a Strong Move
On the daily chart, HYPE has been in an uptrend since January. The latest correction from the all-time high brought the price down to the 0.382 Fibonacci level (around $55.41), and then the pullback ended at the 0.236 level ($63.66). Each subsequent decline is becoming shorter, indicating growing demand. The Relative Strength Index (RSI) has moved to 60 but has maintained its bullish structure.
The situation is even more telling on the 4-hour chart: the price is forming a contracting triangle. HYPE is now very close to the upper boundary of the pattern, around $72. The Bollinger Band Width Percentile (BBWP) indicates extremely low values, which historically often precedes a strong move in one direction.
July Forecast: Two Scenarios
Bullish Scenario: If there is a close above the triangle boundaries on the 4-hour chart, followed by a daily candle closing above $76.70, the price will enter a phase of updating highs. The height of the pattern suggests a potential move towards $88 — approximately 22% above the current level. Continued inflows into ETFs could strengthen this scenario.
Bearish Scenario: If the price fails to break the all-time high, the first target will be $63.66, followed by $55.41. A daily close below $63.66 would indicate a deeper correction. The global uptrend will only be threatened if the price falls below $42 — the level where the 0.618 Fibonacci retracement and the trend line converge.
July will be a decisive month for HYPE. Whether the volatility squeeze resolves with a breakout to new highs or a pullback to test support again remains to be seen.
My Expert Opinion: The combination of strong internal buybacks and institutional demand through ETFs creates unique support for HYPE. However, I would not discount regulatory risks and the constant pressure from unlocks. I assess the probability of a breakout above $76.70 and a move towards $88 as high, but only if the macroeconomic backdrop remains favorable. In the event of a general market correction, the project's internal support will inevitably weaken, and we will then see a test of the $55-63 zone.