Hyperliquid HYPE Buybacks Signal Two-Year Supply Crunch
Hyperliquid’s aggressive buyback program is set to repurchase all liquid HYPE tokens within two years, raising concerns of a looming supply crunch. The DeFi protocol leads the perpetual DEX market with $5 billion in TVL and over 60% market share. Strong fundamentals include a P/E ratio of 2, $4 million in daily revenue, and a token price of $35.37, implying a full buyback in just 1.94 years. Since March 2025, Hyperliquid has deployed $521.85 million to repurchase 15.26 million HYPE, or 5.64% of its circulating supply. Buybacks target the $30–$35 range, drawing interest from derivative whales. As token availability tightens and demand remains robust, traders could see a bullish reversal in HYPE.
Bullish
Hyperliquid’s accelerated HYPE buyback program reduces token supply significantly, setting the stage for a supply-demand imbalance. Historical precedents in DeFi show that aggressive token repurchases often lead to price appreciation, as seen with protocols like Uniswap and Aave when they executed treasury buybacks. With less than two years to absorb all liquid supply, Hyperliquid is likely to face a looming supply crunch, especially given its 60% dominance in perpetual DEX TVL and $4 million daily revenue. Buybacks funded by protocol fees ($521.85 million since March 2025) have already shaved 5.64% off circulating supply, attracting derivative whales capitalizing on potential price rebound. In the short term, this may spark a bullish reversal if buyback windows coincide with market dips. Over the long term, persistent supply reduction combined with sustained demand could solidify HYPE’s position as a DeFi growth token, driving higher valuations and momentum in trader interest.