Arthur Hayes Offloads HYPE Tokens Amid Hyperliquid Concerns

By: Eva Baxter

In a surprising move, Arthur Hayes, the co-founder of BitMEX and current Chief Investment Officer at Maelstrom, sold 96,600 Hyperliquid (HYPE) tokens for approximately $5.1 million. This decision came less than three weeks after Hayes had publicly predicted a bullish upward movement for the digital asset. The sale, which Hayes initially claimed was to fund the purchase of a Ferrari, appears to be rooted more deeply in risk management due to looming structural challenges faced by Hyperliquid.

According to a statement issued by Maelstrom on X, the sharp sale was influenced by Hyperliquid's unsettling token unlock schedule set to commence on November 29. This schedule will unlock approximately 237.8 million tokens over the span of 24 months, potentially flooding the market with about $500 million worth of tokens every month. Maelstrom’s analysis estimates that Hyperliquid’s buyback scheme could absorb only 17% of this, leaving $410 million worth of tokens exposed to open-market sales, thus creating considerable selling pressure.

The risk is compounded by key Hyperliquid developers and other large investors potentially selling their token allocations once vesting begins. Maelstrom’s caution is warranted, considering that these incoming tokens could significantly dilute the market, affecting the asset’s liquidity and price.

Furthermore, Hyperliquid is facing intensified competition from newer decentralized exchange (DEX) platforms such as Lighter and Aster. Aster, in particular, has gained substantial traction, partly fueled by backing from Binance and features like hidden orders and multichain support. This shift in attention marks a notable rotation of interest and capital within the decentralized finance sector, leaving Hyperliquid to contend with shrinking market dominance as HYPE’s price has already taken a downward hit in recent days.

The developments surrounding Hyperliquid and Hayes's sale highlight the volatile nature of the cryptocurrency market and the rapid shifts in sentiment driven by both technical factors and competitive landscapes. Whether Hyperliquid’s HYPE token can withstand these multifaceted challenges remains uncertain, with market participants closely monitoring the looming vesting date and the token’s price trajectory in the coming months.