Hyperliquid Foundation burns $912 million worth of HYPE. Can the token price return to $40?

Hyperliquid (HYPE) has recently been under continuous pressure, with a clear weakening in price movement. Previously, when market conditions were relatively stable, HYPE approached $50, but then entered a downtrend and retreated to a stage low of around $22 in the past two months. As of now, HYPE is approximately at $23.94, down 1.39% daily, with a weekly decline of nearly 12%, reflecting that overall market sentiment remains cautious.

Against the backdrop of persistent price weakness, the Hyper Foundation has chosen to intervene through token burns. According to governance voting results, Hyperliquid has officially burned approximately 37 million HYPE tokens, worth over $912 million. The burn plan received about 85% support, representing a typical deflationary token economic adjustment.

On-chain data shows that since December 2024, the Hyper Foundation has continuously accumulated HYPE tokens through buybacks, with an average daily investment of about $1.5 million. Over the past week, the foundation spent approximately $12.4 million, adding nearly 500,000 tokens. With this burn completed, these tokens have been transferred to inaccessible addresses, directly reducing the circulating supply by about 11%–13%, tightening the long-term supply and demand structure of HYPE.

From historical experience, large-scale token burns usually help enhance scarcity and alleviate selling pressure to some extent. Meanwhile, spot market data also signals positive developments. In recent trading days, outflows of funds from HYPE on exchanges have remained higher than inflows, with net spot flows staying in negative territory, indicating that investors prefer to transfer tokens out of exchanges rather than short-term selling.

Regarding sentiment indicators, market buying power has begun to rebound. Data shows that the average bullishness has significantly exceeded bearishness, indicating that the bulls are re-accumulating momentum. If the token burn effect continues to ferment and spot demand warms up, HYPE’s price is expected to first rebound to the $30 region and further test the key target of $40.

However, risks still exist. If deflationary measures fail to effectively improve the market structure, HYPE may still break below the $20 support level and retreat to the $19 region. In the short term, token burns provide an important buffer for Hyperliquid, but whether the price can truly reverse still depends on overall market sentiment and the sustainability of capital flows.