BitMEX co-founder Arthur Hayes exits HYPE position, citing risks from rising competition in real-world asset perpetuals.
Hyperliquid faces growing competition from Wall Street and established crypto exchanges after securing $3 billion in real-world asset open interest. The protocol’s token-burning mechanism, funded by trading fees, may become vulnerable if market share declines, according to Arthur Hayes.
Hayes, who previously predicted HYPE would reach $150, liquidated his entire position this week. The decentralized derivatives platform has surged in popularity since 2023, but Hayes warned that increased competition could pressure its core revenue model.
Hyperliquid’s reliance on fee-driven token burns to create scarcity leaves it exposed to shifts in trading volume. Hayes noted that traditional finance and centralized exchanges are expanding into real-world asset perpetuals, threatening Hyperliquid’s dominance.