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Hyperliquid rallies after renewed whale demand
Hyperliquid (HYPE) has surged this week, posting gains of more than 40% as large holders increased their positions and the protocol advanced expansion plans. The token jumped to a 10-week high near $38 on Feb. 3, extending momentum that began after the HyperCore team signaled support for HIP 4 — a proposal to expand into prediction markets.
Key takeaways
- HYPE climbed roughly 21% in 24 hours and over 40% across seven days.
- Large wallets ($1M–$5M) and mid-sized holders ($50K–$500K) showed clear accumulation.
- A bullish crossover of the 20-day and 50-day moving averages occurred on the daily chart.
Whale accumulation, staking and tokenomics
On-chain tracking services show increased accumulation by so-called whales — wallets holding between $1 million and $5 million in HYPE — while sharks and dolphins (mid-sized holders) also added tokens. This kind of concentration among larger holders often signals confidence in the project’s medium- to long-term potential and can influence retail inflows.
The momentum coincided with HyperCore’s backing of HIP 4, which would allow Hyperliquid to support fully collateralized prediction market contracts. Expansion into prediction markets is being watched closely by traders and liquidity providers as these markets have seen renewed interest across the broader crypto ecosystem.
As more users stake HYPE for governance or network participation, the circulating supply tightens. That dynamic is amplified by Hyperliquid’s buyback-and-burn policy: 97% of net platform fees are reportedly used to buy tokens on the open market and remove them from circulation, creating persistent deflationary pressure and improving HYPE’s tokenomics over time.
On-chain and exchange activity
HIP 3 upgrades preceded the latest wave of trading activity, boosting volume in commodities markets such as gold and silver on the Hyperliquid exchange. Higher trading throughput feeds fee generation, which in turn supports the buyback mechanism — a virtuous cycle that can underpin price appreciation if volume remains elevated.
Technical analysis: bullish crossover and indicators
On the daily chart, HYPE confirmed a bullish crossover as the 20-day simple moving average crossed above the 50-day SMA, a classic short-term momentum signal that historically preceded strong rallies for this token. In the previous instance of a similar crossover, HYPE rose nearly 35% in a little over a month.
Hyperliquid price has formed a bullish crossover on the daily chart — Feb. 3
Additional technical indicators support a constructive near-term outlook: the MACD lines are trending higher and the Supertrend indicator has flipped green, both reinforcing the bullish bias.
Targets and risk thresholds
Traders eye a primary upside target around $51, which aligns with the 78.6% Fibonacci retracement level on recent charts. Conversely, a sustained breakdown below $29.6 — the 23.6% Fibonacci level — would undermine this bullish thesis and could signal a return of selling pressure.
What to watch next
- Continued whale accumulation: follow on-chain wallet flows for further buying from large holders.
- HIP 4 progress and prediction market integrations: product developments that can expand utility and fee generation.
- Fee-driven buybacks: monitor platform fee reports and buyback frequency to gauge deflationary impact.
- Key technical levels: the $51 upside target and the $29.6 invalidation point.
Investors should weigh HYPE’s improving fundamentals and deflationary mechanics against typical layer-1 and token-spec risk factors. While the current setup favors additional upside in the near term, volatility remains an inherent element of crypto markets and risk management is essential.
Source: crypto
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