Can HYPE regain its momentum after burning $9.12 million? From a low of $22 to a target of $40

Hyperliquid has recently been in a difficult period. The HYPE token, which reached $50 two months ago, is now experiencing sustained downward pressure. As of the time of writing, HYPE’s trading price is $21.69, down 9.49% in the past 24 hours, and on the weekly chart, it has declined by 10.91%, indicating clear market pressure. The token previously touched a local bottom of $22 during its decline and is currently hovering near this low point.

Over $910 Million in Burned Tokens: Hyper Foundation’s “Self-Help” Measure

Faced with ongoing market pressure, the Hyper Foundation has decided to take action. Through a community voting mechanism weighted by staked tokens, 85% support was achieved for a burn plan—destroying 37 million HYPE tokens.

According to an official statement, these tokens come from the Assistance Fund Addresses account, with a total value exceeding $9.12 million. This address has been accumulating HYPE tokens through buybacks since December 2024, increasing holdings from 9.3 million to 37.51 million tokens.

In the past week, the foundation spent an average of $1.5 million daily on buybacks. Over the last 7 days, it invested a total of $12.4 million, acquiring 4.9834 million tokens. These tokens are now sent to inaccessible addresses for burning, permanently removing approximately 11-13% of the circulating supply.

On-Chain Data Signals Positive Outlook

From on-chain performance, positive signals have emerged. Net outflows from exchanges have continued to exceed net inflows, with Spot Netflow remaining positive. As of press time, net outflows reached $5.1 million, indicating a large amount of tokens are leaving exchanges and moving into cold wallets.

This trend generally suggests that holders are optimistic about the future, reducing selling pressure on exchanges.

Buying Power Begins to Awaken

After the burn plan was announced, market sentiment shifted noticeably. Data shows that buyers have exceeded sellers for the first time in over two weeks. The average bullishness increased to 17, while bearishness decreased to -9, indicating that the long side is gaining strength.

Although selling pressure still exists, the advantage is gradually shifting to buyers. This dynamic balance lays the foundation for a rebound.

Can HYPE Break Through $40?

If the effects of the burn are fully realized, coupled with a recovery in spot market demand, HYPE could potentially retake $30 and even target the $40 level. However, if this deflationary measure fails to effectively curb selling, the token might break below the $20 support level and further decline to $19.

The market’s key depends on whether buying power can be maintained and whether spot demand truly picks up.