Hyperliquid’s native token, HYPE, ripped to $62 this week, logging a 120% year-to-date gain and pushing its market cap past $15 billion. The rally came as the platform’s total value locked (TVL) surged above $5 billion for the first time since October 2025 — a milestone that underscores just how far the integrated on-chain financial platform has come since its launch.
Outperforming a Bear Market
The broader crypto market has been in a rough patch. Since September 2025, the aggregate market is down 36.5%. Bitcoin has shed 33.4%, and Ethereum has cratered 53.3%. HYPE, by contrast, has gone the other way. It’s a stark divergence that’s caught the attention of traders and allocators alike.
Short Squeeze and Open Interest
Part of this week’s move came from a classic short squeeze. Negative funding rates on HYPE perpetuals forced liquidations of bearish positions, sending the price higher. Open interest sits at $1.92 billion — a sign that conviction on both sides remains high. The squeeze amplified gains that were already building on the back of fundamental growth.
US Traders Driving Gains Despite Geofencing
Here’s the irony: US residents can’t directly access Hyperliquid’s platform — it geofences them out. Yet US trading sessions accounted for over 40% of HYPE’s recent price gains. That suggests American traders are finding workarounds, or that the token is being traded on other venues where US users aren’t blocked. Either way, the demand is real and it’s coming from the largest capital market in the world.
Institutional Interest: ETFs and a 'Super-App' Vision
The institutional angle is getting louder. Bitwise and 21Shares now manage $81.13 million in HYPE-related ETF assets, with trading volumes approaching $100 million. Bitwise CIO Matt Hougan has described Hyperliquid as a potential “global super-app” — one that targets the $600 trillion global assets market, not just the $3 trillion crypto market. That framing, grandiose as it sounds, helps explain why ETF flows are picking up even as the broader market struggles.
The question now is whether HYPE can sustain this momentum. The TVL recovery and ETF flows provide a real foundation, but the short squeeze element means some of the recent price action is borrowed from future volatility. Traders will be watching whether open interest holds and whether the US regulatory picture — especially the geofencing issue — shifts in any meaningful way.
