Why ETFs Are Shunning HYPE — and Why Grayscale Thinks That's Hilariously Wrong

ETF investors are pulling back and HYPE is wobbling

Short version: the HYPE token has taken a hit after money started flowing out of funds tied to it. Those exchange-traded products saw their first month of net redemptions since launch, with millions exiting in July and a noticeable reversal of inflows that had been steady for weeks. The token, which hit highs around mid‑June, slid back roughly a third from that peak and is now flirting with its second losing month of the year.

The selling pressure from funds appears to have a real impact on price: when big pools of investor cash move out, token demand can evaporate fast. Add in a bit of macro gloom and quieter on-chain appetite, and the result is a token that looks cheaper by the minute — depending on which side of the trade you’re on.

Grayscale’s contrarian pitch: revenue, buybacks and an “earnings per token” model

Enter Grayscale, waving a spreadsheet and saying, “Hold my coffee.” Their take is straightforward and annoyingly neat: Hyperliquid isn’t just hype — it actually generates fees from trading activity, funnels a chunk of that cash into token buybacks, and therefore has a real economic link between protocol revenue and HYPE’s value.

Using an adapted earnings-per-share idea (they call it earnings-per-token), Grayscale projects the protocol could be pulling in much more revenue over the next few years — enough that, on their math, HYPE’s forward earnings work out to a few dollars per token. At current prices, that translates into a relatively low multiple compared with some public fintech peers, which is their argument for why HYPE looks undervalued.

But the spreadsheet has footnotes. HYPE holders don’t actually own the company, revenue doesn’t automatically get paid out like corporate dividends, and the valuation depends on several moving parts: steady trading volumes, continued buybacks, and token supply behaving as forecast. If any of those assumptions wobble, the math changes fast.

Also important: Hyperliquid has been expanding beyond pure crypto markets. Perpetual contracts tied to stocks, commodities and indexes have grown quickly on the platform, sometimes accounting for a big slice of weekly volume. That diversification could widen the revenue pool beyond crypto traders — a plus for the Grayscale thesis — but it also introduces fresh regulatory and liquidity risks that weren’t as prominent before.

So, should you care?

If you like narratives: this is a classic tug-of-war. On one side you’ve got market sentiment — funds selling, headlines shrinking enthusiasm, short-term price moves. On the other, Grayscale is betting the underlying business is maturing and that today’s weakness is a buying opportunity if their forecasts hold.

For traders, volatility from ETF flows and weekly volume swings is either opportunity or heartbreak, depending on timing. For longer-term thinkers, the key questions are whether trading fees stay robust, buybacks persist, and supply dilution is limited. If those things happen, the token could indeed look cheap; if not, the market is probably pricing in real risk.

In plain English: HYPE’s business is growing faster than people are willing to hold the token right now. That mismatch makes for an entertaining soap opera — and a decision point for anyone who’s skeptical of spreadsheets or optimistic about protocol revenue turning into token value.