As Bitcoin Falls, a New Crypto Product Gains Unexpected Momentum
While many investors are moving away from major cryptocurrencies, a new project is attracting growing capital inflows. Exchange-traded funds (ETFs) linked to HYPE have seen strong investor demand despite the weak performance of Bitcoin and Ethereum during May.
The growing interest follows the launch of spot ETFs by Bitwise and 21Shares, designed to track HYPE, a decentralized digital asset operating on its own blockchain network known as Hyperliquid.
Despite the losses affecting the broader cryptocurrency market, HYPE-related investment products continue to attract investors. The funds trading under the tickers BHYP and THYP have accumulated approximately $150 million in assets and have recorded positive inflows on most trading days since their launch. This trend has drawn the attention of investment experts, including Nate Geraci, President of NovaDius Wealth Management.
While major cryptocurrencies face selling pressure, HYPE ETFs have delivered remarkable success. The funds have attracted nearly $150 million in assets and maintained consistent investor inflows, prompting several Wall Street analysts to closely monitor this emerging trend.
Last week, the sector reached another milestone when Grayscale Investments launched its new Hyperliquid Staking ETF under the ticker HYPG.
Commenting on the project's future, Matt Hougan, Chief Investment Officer at Bitwise Asset Management, stated that Hyperliquid is still in its early stages. He emphasized that only a small portion of its potential has been realized and that most investors have yet to discover the platform.
Hyperliquid is a decentralized trading platform specializing in perpetual futures contracts and built on blockchain technology. It allows users outside the United States to trade around the clock. Although the platform remained relatively unknown for a long time, geopolitical events during the past summer—particularly tensions between the United States and Iran—helped increase its popularity as traders sought access to oil markets during weekends.
This growing interest was reflected in trading volumes, which rapidly climbed to nearly $1 billion per day in crude oil contracts alone, according to Steven Kolton, Vice President and Head of Macro Economics at 21Shares.
For a digital asset that was virtually unknown to many financial advisors and investors until recently, the level of attention Hyperliquid has received is remarkable, especially at a time when major cryptocurrencies are facing significant pressure. In contrast, Bitcoin-related ETFs experienced notable declines in assets, with the iShares Bitcoin Trust (IBIT) ending the week down by nearly 16%.
