Hyperliquid's HYPE has fallen 22% from its July peak of $73 and broken a key trendline. Fading U.S. spot ETF demand, a $120M unstake by Multicoin Capital and buybacks cut by 3x are driving the selling. Analysts have turned defensive, with one projecting a further 38% slide toward $35.
Hyperliquid's HYPE has extended its losses to 22% from the July peak of $73, breaking a key trendline as analysts turn defensive. Crypto analyst Michael Van de Poppe wrote that "$HYPE has lost the uptrend unfortunately", saying he would be more passive on a potential trade.
Van de Poppe preferred slow scaling if the pullback extends — a dollar-cost averaging approach that allocates small amounts periodically. Another analyst and trader, Dylan Loomer, known as Trader Mayne on X, projected a potential 38% pullback to the monthly demand zone near $35.
Institutional demand faded after June's record high
That defensiveness follows a strong first half. HYPE outperformed the market in the first half of 2026, partly fuelled by the early West Asia crisis.
But the institutional demand from U.S. spot HYPE products that fuelled the rally to a new all-time high in June has faded in July. Since mid-July the products have stayed negative for the longest time since their debut, bleeding an average of $1M per day — about 20K HYPE — since the 10th of July.
Venture firms added to that pressure. a16z and Multicoin Capital, which unstaked a $120M HYPE position this week, further intensified the institutional sell-offs.
Slower trading revenue cut the buyback pace
Trading activity has slowed since June, cutting revenue by 3x from a weekly average of $21M to $7M. That, in turn, slowed the pace of HYPE buybacks by 3x, from 318K HYPE in early June to 108K tokens in late July.
Even at the reduced pace, the buybacks run at about 20K HYPE on a daily average, which should be enough to absorb the ETF sell pressure. It is likely that HYPE is instead reacting to the Multicoin Capital sell-off headline story and broader market sentiment.
Positioning points the same way. Smart money's net positioning was negative, with over $150M betting against its recovery. Traders are actively shorting the altcoin amid declining buybacks and the ETF and VC firms' sell-off, though some analysts believe deeper corrections could offer new discounted buying opportunities.
Source: AMBCrypto
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