The more I break down the Hyperliquid project, the less it looks like a coin and the more it looks like an exchange with its ledger laid out on-chain.
It runs decentralized perpetual futures, matching orders directly on its own chain. It launched its token on November 29, 2024: 310 million HYPE, about 31% of the total supply, were airdropped directly to users who had previously traded on the platform, without first selling any to institutions. That’s the part of its origin story it can most proudly point to today.
Where the money comes from is easy to track. An October report by Castle Labs said Hyperliquid had generated over $1.4 billion in cumulative protocol revenue, of which more than $1.26 billion went toward buying back HYPE. Its share of open interest in on-chain perpetual futures was over 56%. From January through September 15 this year, the protocol generated $429 million in revenue, ranking first among all crypto projects.
Buybacks go through an address called the Assistance Fund: fees come in and are used to buy HYPE. On October 21, the address held 48.17 million tokens, purchased at a cost of about $1.38 billion and worth close to $3.9 billion at market prices. There’s an important distinction here: many people say the tokens were burned, but that’s not quite accurate. On-chain supply that day was still 998.8 million tokens, just 1.2 million below the 1 billion cap. The tokens were collected by a fund address and taken out of circulation, but they weren’t technically destroyed. The buybacks are real; the claim that they were burned needs a caveat.
On August 26 this year, another buyback channel was added: AQAv2. Around 90% of the yield on the platform’s roughly $5 billion to $5.5 billion in USDC reserves is allocated to the protocol, goes into the Assistance Fund, and is used to buy more HYPE. The first payment arrived on October 3, and market estimates suggest this channel could generate an additional $135 million to $160 million a year. This revenue isn’t tied to trading volume, so it can keep flowing even when the market is quiet.
HIP-3 is another piece of the puzzle. After launching in October 2025, it lets external teams stake 500,000 HYPE to launch their own perpetual futures markets on-chain, including stocks, commodities, and indices. Half the fees go to the team that launches the market. Phantom and MetaMask have earned over $25 million and $10.5 million respectively through Builder Codes. Others come to open shop, and it takes a cut.
But no matter how good the buybacks look, they can’t hide what’s happening on the other side. The core team holds about 23.8% of the supply, or roughly 238 million tokens. About 9.92 million tokens unlock on the 6th of every month, continuing through 2027; the batch scheduled for October 6 just unlocked. According to CoinGecko data today, HYPE is at $75.44, down 4.27% over 24 hours, with $798 million in trading volume. Buybacks are a steady trickle of daily purchases; unlocks release a lump sum on the 6th of each month. The two operate on completely different schedules.
When you break it all down, there are just two lines in the ledger. One says the protocol is genuinely making money, and that money is genuinely going toward buybacks. The other says that about 9.92 million new tokens become available every month on the 6th. Look only at the first line and it seems as reliable as a money-printing machine; look only at the second and it feels like a monthly flood. You have to look at both to see what it really is.
My view is clear: I’m bullish on its business model of generating revenue and buying back tokens, but I won’t assume the price has a floor just because of the buybacks. The monthly unlock date on the 6th is more worth marking on your calendar than any buyback announcement.
Do you usually keep an eye on these fixed monthly unlock dates, or do you focus only on the good news about buybacks and revenue?
#Hyperliquid #HYPE #去中心化交易所 #ProjectBreakdown
—— web3 Leek Xiaokai
Disclaimer: These are just my personal views from breaking down the project and do not constitute investment advice. The figures are from public reports and CoinGecko; prices can change at any time, so double-check everything yourself before making a decision.