HYPE: After another round of burning 37 million tokens, it surged to a monthly high. Can the upward trend continue?

TL;DR

On December 24, 2025, HYPE officially burned approximately 37 million tokens (representing 11% of the then-circulating supply) through a governance vote and permanently designated the "Aid Fund" address as the burn pool; the total supply decreased to 962 million , with a strict circulating supply of approximately 238 million .
The price touched 26.49 USDT during the 1-8 trading session, a 12% drop from the 30-day high. Technical indicators are neutral and leverage is cooling down.
In the short term, the price is likely to fluctuate within the 25.85-27.91 range; only if the trading volume increases and the price breaks through 27.91 can it potentially challenge 30.25 again. The medium- to long-term trend still depends on which option is executed faster: daily buybacks or monthly unlocking.

Core Analysis

1. Review of the Destruction Incident

• Timeline :
  • 2025-12-17 → 12-24: Governance vote (85% in favor)
  • 2025-12-26: Official announcement confirms the destruction is in effect.
• Scale : 37 M HYPEs were burned in one go, worth approximately $910 million to $1 billion, corresponding to 11.1% of the circulating supply and 3.8% of the total supply.
• Mechanism Upgrade : The vote also stipulates that 99% of the transaction fees received by the aid fund in the future will be automatically regarded as "continuous burning", forming a passive deflation of ~2 million USD bought back every day .

2. Supply side: Deflation vs. Unlocking

Key Points

1. Daily buybacks are roughly equivalent to 2.6 times the monthly unlocking rate – if trading volume remains stable, net supply will still be on the contraction side.
2. The top ten addresses hold 38.8% of the shares, indicating a moderate concentration. Recently, some early addresses have been observed to liquidate their positions and leave the market, but large investors have continuously bought and locked up 80,000+ HYPE shares from the 1st to the 6th, indicating that the shares are being transferred to long-term accounts.

3. Technical Analysis and Derivatives

• Price Structure • The daily chart is between 25.54 (middle band) and 28.74 (SMA50) , and the trend indicator ADX is 24, still in a weak range.
  • The 1h/4h EMA shows repeated crossovers between bullish and bearish trends, indicating that the short-term direction is unclear.

• Key levels and resistance: 27.07 → 27.91 → 30.25
  • Support levels: 26.30 → 25.85 → 25.54 → 22.20

• Leverage Temperature • Overall OI 1.46 B USD , down -2.9% in 24 hours, bullish sentiment is cooling.
  • Bybit funding rates turned negative (-0.019%), while Binance was slightly positive, indicating a divergence between long and short leverage.
  • 24-hour liquidation: Long positions 1.61 M USD > Short positions 0.04 M USD, indicating that those who chased the rally were shaken out.

• Technical indicators : RSI 1d = 48.5, MACD daily histogram turned red but is still below the zero line, indicating weak momentum.
  • OBV 4h/1d is still negative, and volume needs to increase to support a breakout.

4. Social Interactions and Emotions

• Mood Thermometer : Overall "Cautiously Optimistic"
  • Burning and high-cost buybacks are seen as "super deflation," and KOLs often emphasize the advantage of "no VC selling pressure."
  • The controversy centers on the HIP-3 new market fee model and team unlocking; some analysts worry that the continued unlocking starting in February may dilute the short-term rebound.
  • Discussion activity increased compared to December, but tweet engagement was lower than the peak in 2025, and funding and public attention are still in a wait-and-see period.

in conclusion

1. Short-term : The decline in open interest and divergence in funding rates for the US dollar index at 1.46B indicate a weakening of upward momentum; if it fails to break through 27.91 with significant volume, the US dollar index may continue to trade sideways between 25.85 and 27.91.
2. Mid-term : Transaction fees and one-off monthly unlocks by the team are almost offset, and net supply remains slightly negative, which is fundamentally favorable for prices; however, attention should be paid to the market's repricing of the continued unlocking after February.
3. In the long term : If Hyperliquid maintains high trading volume and continues to automatically burn funds, HYPE has a structural deflationary logic; fluctuations in transaction fees caused by platform share and competition will become the decisive variables.

In summary, if this rally can hold the 25.5-26 area, the structure is secure. However, for a rapid return to and breakthrough of 30 USD, two major catalysts are needed:
• Significantly increased trading volume → Increased buyback scale;
• The market is signaling "no sell-off" for the next round of team unlocks.