Billionaire Stanley Druckenmiller Has Become a High-Profile Backer of Hyperliquid. Should You Follow His Lead and Buy HYPE?

Cryptocurrency Hyperliquid (CRYPTO: HYPE) continues to skyrocket. It's up more than 180% this year. In 2027, Hyperliquid could be headed even higher, now that it has the support of President Donald Trump's administration.

So it's no surprise that high-profile investors are now looking for ways to get exposure. One of those is billionaire Stanley Druckenmiller, who has been making headlines in 2026 with his Hyperliquid-related investments.

So why is Druckenmiller buying Hyperliquid? And is Hyperliquid right for your portfolio?

Growth in perpetual futures

The reason for Hyperliquid's meteoric ascent is easy to explain: perpetual futures. These financial derivatives have taken the crypto world by storm, and they're now coming for everything from stocks to commodities.

Perpetual futures (also known as "perps") enable traders to make directional, highly leveraged bets on future prices, all without owning the underlying assets. And perpetual futures, as their name suggests, come with no expiration dates. That's music to the ears of short-term traders and speculators.

Hyperliquid, a popular decentralized exchange (DEX), is a leader of this rapidly growing market. According to some estimates, Hyperliquid controls as much as 70% of the market for perpetual futures on decentralized exchanges.

Stanley Druckenmiller and Hyperliquid

That helps to explain why billionaire Stanley Druckenmiller is buying Hyperliquid. He recently made a $23 million investment in trade[XYZ], a privately held company helping to bring Hyperliquid-based perpetual futures contracts to Intercontinental Exchange (NYSE: ICE). Trade[XYZ] also happens to be one of the biggest builders on the Hyperliquid trading platform.

Image source: Getty Images.

Before that, Druckenmiller made headlines with his investments in Hyperliquid Strategies (NASDAQ: PURR), a Hyperliquid treasury company. Just like a Bitcoin (CRYPTO: BTC) treasury company or an Ethereum (CRYPTO: ETH) treasury company, Hyperliquid Strategies buys only a single digital asset. In this case, it's HYPE.

Should you believe the HYPE?

Obviously, Hyperliquid is one of the few bright spots in the crypto market this year. At a time when Bitcoin is down 15% for the year and Ethereum is down 30%, it's noteworthy that Hyperliquid is still delivering triple-digit returns.

But here's the thing: There's plenty more competition coming soon in the perpetual futures market now that regulators have approved trading in perps for U.S. customers. That's good news for individual investors, who can already trade them on platforms such as Kalshi and Coinbase Global (NASDAQ: COIN). But it's not necessarily good news for Hyperliquid investors, who must now worry about continued slippage in market share.

Moreover, regulatory issues continue to swirl around Hyperliquid. Yes, President Trump recently gave regulators the go-ahead to clear the way for Hyperliquid to enter the U.S. market. But Hyperliquid (based in Singapore) still does not have approval to operate in the U.S., and this approval could take some time, given the results of the midterm elections.

For that reason, I'm not as bullish on Hyperliquid as some others. Until I can sign up for a Hyperliquid account on my laptop inside the U.S., I'm not buying the HYPE.

Dominic Basulto has positions in Bitcoin and Ethereum. The Motley Fool has positions in and recommends Bitcoin, Ethereum, and Hyperliquid. The Motley Fool recommends Coinbase Global. The Motley Fool has a disclosure policy.