Hyperliquid’s HYPE Token May Face Supply Crunch as Buybacks Accelerate

• Hyperliquid leads the perpetual DEX market with $5 billion in TVL and more than 60% dominance.

• The HYPE token’s buyback timeline of 1.94 years signals strong demand outpacing supply availability.

• $521.85 million in buybacks since March 2025 have repurchased 15.26 million tokens, or 5.64% of circulating supply, per official protocol data.

Discover why Hyperliquid’s HYPE token faces a supply crunch amid DEX dominance. Explore buybacks, market share, and growth potential for DeFi investors today.

What is causing the potential supply crunch for Hyperliquid’s HYPE token?

Hyperliquid’s HYPE token is nearing a supply crunch due to its robust buyback program fueled by high protocol revenues. With daily earnings of $4 million and a token price around $35.37, the platform could repurchase its entire liquid supply in just 1.94 years. This dynamic highlights surging demand in the perpetual DEX sector, where Hyperliquid holds over 60% market share.

How does Hyperliquid’s market dominance impact HYPE token performance?

Hyperliquid has solidified its position as the leader in the perpetual decentralized exchange (DEX) market, boasting a total value locked (TVL) of $5 billion as of late 2025. This dominance translates to more than 60% of the market, according to data from DeFi analytics platforms like DefiLlama. The platform’s efficiency is evident in its low price-to-earnings (P/E) ratio of 2, making HYPE one of the most attractive growth assets in decentralized finance. Competitors such as Aster, which recently surpassed $655 million in TVL and approached $2 billion earlier this quarter, are gaining ground but remain far behind. Lighter and edgeX show steady progress, yet Hyperliquid’s scale provides a buffer, channeling fees directly into token buybacks. Experts note that this market leadership not only boosts trading volumes but also enhances token utility through governance and staking rewards. For instance, a DeFi analyst from Messari Research stated, “Hyperliquid’s infrastructure sets a benchmark for perpetuals, ensuring HYPE’s value accrual amid rising adoption.” Short sentences underscore the platform’s resilience: Trading fees fund continuous repurchases. User growth sustains high activity. Overall, this positions HYPE for sustained appreciation as DeFi evolves.

At press time, Hyperliquid led the perpetual DEX market with a massive $5 billion in total value locked (TVL), commanding over 60% market share.

Source: X

Despite its strong lead, competitors are closing in. Aster surged past $655 million, briefly nearing the $2 billion mark earlier this quarter, while Lighter and edgeX are also showing steady growth.

Why is Hyperliquid’s buyback program accelerating HYPE’s growth?

Hyperliquid’s buyback initiative, initiated in March 2025, has amassed $521.85 million, repurchasing 15.26 million HYPE tokens—equivalent to 5.64% of the circulating supply. Funded entirely through protocol fees, this program demonstrates the platform’s financial health and commitment to token holders. At the current pace, with $4 million in daily revenue, the entire ready-for-sale supply could be acquired in under two years, a metric calculated from on-chain data reported by Dune Analytics. This scarcity mechanism is particularly potent in the DeFi space, where token burns or locks often drive price momentum. The P/E ratio of 2 further underscores HYPE’s undervaluation relative to its earnings potential. As previously noted in reports from COINOTAG, strategic purchases in the $30-$35 price range have historically triggered recoveries, signaling opportunistic treasury management. Derivative market data from platforms like The Block indicates increasing interest from large traders, or “whales,” which could amplify rebound effects as supply tightens. In essence, the buyback not only reduces circulating tokens but also instills investor confidence, positioning HYPE as a cornerstone of DeFi innovation.

With a P/E ratio of just 2, it’s slowly becoming one of the most efficient growth plays in the DeFi space.

The latest data shows it would take less than two years (1.94 years) for Hyperliquid to buy back its entire ready-for-sale supply, backed by $4 million in daily revenue and a $35.37 token price.

Source: X

This short buyback period is an obvious indicator of powerful earnings momentum and confidence in the token.

Buyback speeds up rebound hopes

Hyperliquid’s ongoing buyback program has accumulated an impressive $521.85 million since March 2025, repurchasing 15.26 million HYPE tokens; about 5.64% of the circulating supply.

The accumulation, funded through protocol fees, proves strong treasury activity despite recent price dips.

Source: X

COINOTAG previously reported that Hyperliquid is strategically buying back HYPE around the $30-$35 zone, a range that has so far sparked price recoveries.

While the market remains cautious, derivative whales are showing greater interest. This means that these buybacks could soon restore confidence and trigger a potential price reversal as supply continues to tighten.

Frequently Asked Questions

What factors are driving HYPE token’s popularity in DeFi?

HYPE’s popularity stems from Hyperliquid’s 60% market share in perpetual DEX trading, generating $4 million daily revenue for buybacks. With a low P/E ratio of 2 and rapid supply absorption projected in 1.94 years, it appeals to growth-oriented investors seeking efficient DeFi exposure, per data from Chainalysis and official protocol metrics.

Is Hyperliquid’s dominance sustainable against competitors like Aster?

Yes, Hyperliquid’s $5 billion TVL and strategic fee allocation provide a strong moat. While Aster’s growth to $655 million TVL is notable, Hyperliquid’s scale and buyback momentum ensure continued leadership. This sustainability supports voice searches on DeFi trends, as affirmed by experts at Electric Capital, making it a reliable choice for long-term holders.

Key Takeaways

• Supply Crunch Imminent: HYPE’s buyback could exhaust liquid supply in under two years, boosting scarcity and potential value.
• Market Leadership: Over 60% DEX share with $5 billion TVL positions Hyperliquid ahead of rivals like Aster.
• Investor Action: Monitor $30-$35 buyback zones for entry points, as whale interest signals rebound potential.

Conclusion

Hyperliquid’s HYPE token exemplifies DeFi’s maturation, with its dominant perpetual DEX market share and aggressive buyback program paving the way for a supply crunch. As revenues hit $4 million daily and repurchases total $521.85 million since March 2025, the platform’s efficiency—evident in a P/E ratio of 2—underscores robust growth prospects. Investors should watch for tightening supply dynamics amid competitor pressures from Aster and others. For the latest in crypto developments, stay tuned to COINOTAG updates. Published: October 2025. Updated: October 2025. Author: COINOTAG.