- Rising liquidity inflow into Hyperliquid can be positive for HYPE as it continues to trail BTC.
- Annualized trading fees and DEX trading volume have continued to rise, suggesting high interest in the altcoin.
Hyperliquid [HYPE] cooled off over the past 24 hours, dipping 2.77% to trade at $33. However, a deeper look revealed this pullback might be temporary.
On top of that, rising liquidity on Hyperliquid could provide the fuel needed for a fresh leg up. AMBCrypto analysis indicates that HYPE’s performance is also tied to Bitcoin’s market strength.
What does a Bitcoin correlation mean for HYPE?
Interestingly, HYPE has continued to mirror Bitcoin’s performance—both assets have charted synchronized highs and lows in recent weeks. This correlation isn’t random.
One reason for this correlation can be traced to HYPE’s native platform, Hyperliquid, which allows Bitcoin whales to open long trades on the asset.
The daily chart reflects this correlation, showing both assets moving in tandem—making new highs and lows simultaneously.
Source: TradingView
This suggests that a Bitcoin rally would likely result in HYPE following the same path.
In fact, just in the past 24 hours, a single whale opened a $250 million BTC long. If this trend continues and liquidity keeps pouring into Hyperliquid, HYPE could ride that wave higher.
What does HYPE’s on-chain sentiment suggest?
While HYPE stands to benefit from added liquidity and its correlation with Bitcoin, on-chain activity also suggests the asset remains bullish.
In the past 24 hours alone, Hyperliquid generated the highest Trading Fees among all protocols, currently at $3.1 million, surpassing Ethereum [ETH], Tron [TRX], Solana [SOL], and Bitcoin [BTC].
Source: Artemis
In fact, the annualized fee generated by Hyperliquid stood at $777 million, a 52% increase over the past 30 days. Such consistently high trading fees imply that more users are actively using the platform.
Meanwhile, Total Value Locked jumped from $289.46 million at the start of May to $505.41 million. That $215.95 million increase suggests more users are depositing HYPE into the protocol, reinforcing bullish conviction.
Source: DeFiLlama
While bullish momentum is building, an analysis of daily transactions and active users showed a continued decline.
At the time of writing, Daily Transactions declined to 518 million, while Daily Active Perpetual Users remained at 24,200.
Source: Artemis
This is a positive sign, considering that over the past few days, HYPE dropped from an all-time high to $33. It suggests that selling pressure has cooled significantly and buying activity is likely to resume soon.
The dip in DEX volume to $415 million, paired with falling transactional activity, hinted that most addresses were holding—not selling.
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