Grayscale Thinks Hyperliquid Token Undervalued Amid Downturn

Hyperliquid's token, HYPE, has been experiencing a decline in value, dropping by over 13% in July to trade near $54. This is roughly 30% below its mid-June record high of $76.

The token's price drop coincides with net outflows from Hyperliquid-linked exchange-traded funds (ETFs), which have seen more than $13 million withdrawn in July, marking their first negative month since inception.

Grayscale Research argues that the token is undervalued, citing its earnings-per-token model, which estimates HYPE could approach $1 billion in annual revenue by 2027. According to this model, the token's price would be around 15-18 times projected earnings, compared to 35-40 times for Coinbase and Circle.

However, Grayscale's valuation depends on trading activity remaining strong, buybacks continuing, and token supply staying within its projected range.