HYPE token surges after $888 million Wall Street-backed merger

Hyperliquid’s HYPE token has defied broader market sentiment, climbing over 7% over the past 24 hours, even as Bitcoin and Gold suffered pullbacks throughout this week. The fall for Bitcoin and Gold has been attributed to profit-taking across the market.

The HYPE token sustained growth amid a broader bearish market sentiment, following the reverse merger between Sonnet Bio Therapeutics and a private entity, Rorschach I LLC, valued at $888 million, which created Hyperliquid Strategies Inc. (HSI). The newly formed company will manage a digital asset treasury, acquiring more HYPE tokens.

HYPE token jumps over 7% today as Bitcoin slumps over 2% this week

Based on CoinMarketCap data, Hyperliquid’s native token HYPE has climbed over 7% today, trading at $37.24, which represents a 7.25% jump over the past 24 hours at the time of publication. Bitcoin, on the other hand, slumped throughout this week with a 2.07% drop and struggles today with a positive 0.33% change, trading at $108,848.27 at the time of publication. 

The bearish sentiment has also caught up with Gold, which has experienced a sudden drop this week after a sustained period of bullish momentum. The metal price declined by over 5% this week and continued to drop by 0.2% today. 

According to a filing to the SEC on October 22, Hyperliquid Strategies Inc. will launch a digital asset treasury platform, valuing it at roughly $583 million in HYPE. The firm will raise an additional 1$ billion through an offering of 160 million new shares. A portion of the funds will be used to purchase additional HYPE tokens. Shivam Thakral, CEO of BuyUCoin, noted that when a digital asset treasury buys a significant amount of an asset, that’s a bullish signal as institutions tend to hold longer than retail investors, which provides stability and long-term confidence. 

Institutional investors have increased their exposure to DeFi projects significantly through Bitcoin and Ethereum ETFs, primarily driven by the search for yield and diversification. According to a recent Cryptopolitan report, BTC and ETH ETFs have continued to experience sustained outflows, which may have contributed to the current bearish sentiment surrounding these tokens. 

SoSoValue data shows that US BTC ETFs have shed off roughly $101.29 million as of today, while US ETH ETFs have experienced $18.77 million in outflows. Despite that, trading volumes have remained strong, suggesting that investors are reallocating funds towards more flexible alternatives.

Hyperliquid Strategies’ merger boosts HYPE’s institutional appeal

Hyperliquid Strategies Inc. (HSI) appeals to Hyperliquid’s perpetual futures model, which allows investors to speculate with leverage while maintaining token custody. The approach taps into centralized efficiency and blockchain transparency. 

HYPE has continued to receive validation from other established DeFi infrastructures. For instance, early this month, the MetaMask exchange added native support for Hyperliquid swaps, which allows users to make trades directly from their wallets, thereby expanding HYPE’s accessibility. The latest merger involving Sonnet Bio Therapeutics and Rorschach I LLC deepens the institutional validation of the ecosystem and may potentially transform Hyperliquid into a recognized institutional trading venue. 

Amid HYPE’s growth, BNB Chain’s Aster has lost over 40% of its value this month. Aster had maintained competition as one of the top-performing DEX tokens, offering competition to HYPE. The token peaked near $2.5 last month but has since been dropping, losing 42% of its value this month and 4.5% today alone, trading at $1. 

The Ethereum token has shed over 7% this month, currently trading below its September highs of over $4,000. The token was volatile, maintaining a positive 0.33% change over the past 24 hours, trading at $3,881.14 at the time of publication. The token’s market cap has also dropped below half a billion, trading at just $467 billion with a sustained daily average volume of $42.62 billion. 

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