Weiss Crypto is presenting a balanced view on Hyperliquid’s HYPE token: optimistic about the protocol’s fee-based tokenomics, but cautioning investors not to confuse momentum with a lack of risk. In recent posts, the research firm argued that HYPE’s buyback-and-burn model remains a key strength, even as token unlocks, competition, and regulatory challenges persist.
The warning was straightforward. “But there are some HYPE risks investors should take into consideration,” Weiss Crypto wrote, highlighting three main areas. First is the increase in supply from upcoming contributor token unlocks. “April will see the release of 9.92 million HYPE tokens, relatively modest compared with the platform’s trading activity.” Even described as modest, the point stands: new supply matters, especially for a token whose bullish story relies heavily on reducing circulation.
Second is market structure risk. “Right now, Hyperliquid has the clear first-mover advantage. But that doesn’t mean a powerful disruptor can’t emerge.” This touches on a common dynamic in crypto trading infrastructure. Early dominance can seem lasting, especially when liquidity, activity, and attention feed off each other, but it can also attract challenges from better-funded or more aggressive competitors.
Third is regulatory risk. “US residents will likely stay geoblocked on the official front-end — and sector growth subdued — until regulation clears.” In other words, Weiss sees the potential market as limited for now, not due to lack of product traction, but because access and broader industry growth depend on unresolved policy issues.
This caution was paired with a more positive case for HYPE. In a separate post featuring an infographic, Weiss called the token design “Tokenomics done right.” The graphic illustrated what it termed “The powerful feedback loop”—a cycle where increased platform activity leads to more trading, higher protocol fees, greater token buybacks, and a smaller circulating supply.
Central to this argument is how fees are used. According to the infographic, “97% of trading fees are used to buy HYPE tokens.” From Weiss’s perspective, this mechanism directly converts platform usage into token support. As activity grows, “buyback accelerates,” “circulating supply declines,” and the token’s “appreciation potential” rises, potentially attracting even more activity.
Weiss also emphasized the scale of this mechanism, noting: “During 2025 alone, the protocol burned roughly $1 billion worth of HYPE tokens.” This figure is core to the bullish outlook.
Another Weiss post aimed to demonstrate real-time demand during a market stress event. “On Sunday, as tensions escalated in the Middle East, Hyperliquid hit a major milestone. It processed $1B+ in oil-related trading volume. Why? Because traditional oil markets were closed for the weekend. Decentralized markets never sleep.” Weiss connected this to Bitwise CIO Matt Hougan’s earlier observation that when President Donald Trump announced an attack on Iran at 2:30 am Sunday, US, European, and Asian markets were closed, while “HYPE was open.”
Overall, Weiss’s message is nuanced but clear. The firm sees Hyperliquid as a prime example of crypto infrastructure capturing market flows when traditional markets are offline, and it considers HYPE’s fee-and-burn design particularly robust. At the same time, it reminds investors that even a token supported by an active buyback loop still faces risks from token unlocks, competitors, and the slow pace of U.S. regulatory clarity.
At press time, HYPE was trading at $37.87.Chart from TradingView.com
Frequently Asked Questions
Of course Here is a list of FAQs based on Weiss Cryptos identification of three major risks for Hyperliquid and its HYPE token structured from beginner to more advanced questions
Beginner Definition Questions
1 What is Hyperliquid and the HYPE token
Hyperliquid is a decentralized exchange built for highspeed lowcost perpetual futures trading The HYPE token is its native governance token allowing holders to vote on the platforms development and earn rewards
2 What did Weiss Crypto say about Hyperliquid
Weiss Crypto a wellknown cryptocurrency ratings and analysis firm published a report highlighting three significant potential risks that could affect Hyperliquids growth and the value of its HYPE token
3 What are the three major risks Weiss Crypto identified
The three major risks are 1 Centralization Risk 2 Competition Risk and 3 ValuationAdoption Risk
RiskSpecific Questions
4 What is the Centralization Risk
Despite being a decentralized exchange key decisions and upgrades for Hyperliquid are currently controlled by a small anonymous founding team This means users must trust this core group to act in the networks best interest which contradicts the ideal of full decentralization
5 What is the Competition Risk
Hyperliquid operates in an extremely crowded market It competes directly with other established perpetuals DEXs like dYdX GMX and Gains Network as well as centralized exchanges like Binance and Bybit which have much larger user bases and liquidity
6 What is the ValuationAdoption Risk
This risk questions whether the current market value of the HYPE token is justified It concerns whether Hyperliquid can attract enough new users and trading volume to sustain and grow its ecosystem or if growth will stall
Impact Practical Concerns
7 How could centralization actually hurt me as a user
If the core team makes a poor technical decision is compromised or acts maliciously it could lead to platform downtime fund loss or changes you disagree with In a truly decentralized system such changes would require broad community consensus
8 Is Hyperliquids technology not good enough to beat the competition
Weisss point isnt about technology quality