Hyperliquid has permanently removed almost 5% of the maximum HYPE supply from circulation, funded by fee revenue. But monthly unlocks for the team and early contributors still outpace the daily burn, so circulating supply keeps growing.
Hyperliquid has permanently removed 49.87 million HYPE tokens from circulation, almost 5% of the token's maximum supply of 1 billion. On-chain monitoring puts the value of the destroyed tokens at $3.89 billion at the current market rate.
Fees fund automatic buybacks
The supply reduction runs automatically. The protocol converts fee revenue into continuous buybacks from the open market, and its historical revenue has passed $1.38 billion.
The mechanism relies on the Assistance Fund, a system smart contract without private keys. A decision by 85% of the network's validators recognized its balance as burned in December 2025, and between 97% and 99% of trading fees go into it.
Over the past 24 hours, the engine destroyed 19,700 HYPE, about $1.59 million, against daily protocol fees of $1.69 million. Of the $1.38 billion in total revenue, $63.52 million came in over the past 30 days.
Other burn channels
Hyperliquid also uses three additional automated channels: AQAv2 yield routing, gas burning in HyperEVM and HIP-3 developer penalties.
Because the buyback is denominated in US dollars, the rate of destruction fluctuates with the market. At prices of around $78–$80, fewer tokens are withdrawn per dollar of fees.
Unlocks still outrun the burn
The ecosystem's long-term deflationary status depends on whether fee generation can consistently outpace scheduled vesting for the team and early contributors. Those unlocks add about 9.9 million HYPE to circulation every month.
At 19,700 tokens per day, buybacks would absorb roughly 591,000 HYPE per month, offsetting only about 6% of those unlocks. Net circulating supply is therefore still expanding despite the burn.
Source: U.Today
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