Weiss Crypto Flags 3 Key Risks For Hyperliquid And HYPE

Weiss Crypto is making a two-sided case on Hyperliquid’s HYPE token: bullish on the protocol’s fee-driven tokenomics, but clear that investors should not mistake momentum for the absence of risk. In a series of posts over the past days, the research outlet argued that HYPE’s buyback-and-burn structure remains a core strength even as token unlocks, competition and regulation stay firmly on the table.

Hyperliquid Faces 3 Key Risks And The Bullish Case

The cautionary note was direct. “But there are some HYPE risks investors should take into consideration,” Weiss Crypto wrote on Wednesday, before naming three areas to watch. The first is supply expansion from contributor unlocks. “April will see the release of 9.92 million HYPE tokens, relatively modest compared with the platform’s trading activity.” Even framed as modest, the point was clear: fresh supply still matters, especially for a token whose bullish narrative depends heavily on shrinking circulation.

Weiss also pointed to market structure risk. “Right now, Hyperliquid has the clear first-mover advantage. But that doesn’t mean a powerful disruptor can’t emerge.” That gets at a familiar tension in crypto trading infrastructure. Early dominance can look durable, particularly when liquidity, activity and attention reinforce each other, but it can also invite direct attacks from better-capitalized or more aggressive rivals.

The third risk is regulatory. “US residents will likely stay geoblocked on the official front-end — and sector growth subdued — until regulation clears.” In other words, Weiss sees the addressable market as constrained for now, not because the product lacks traction, but because access and broader sector expansion remain tied to unresolved policy conditions.

That warning landed alongside a much more constructive argument about HYPE itself. In a separate post built around an infographic, Weiss called the token design “Tokenomics done right.” The graphic described what it labeled “The powerful feedback loop,” a flywheel in which rising platform activity leads to more trading, more protocol fees, more token buybacks, and less circulating supply.

The centerpiece of that thesis is fee deployment. According to the infographic, “97% of trading fees used to buy HYPE tokens.” From Weiss’s framing, that mechanism is what turns platform usage into direct token support. As activity grows, “buyback accelerates,” “circulating supply declines,” and the token’s “appreciation potential” increases alongside the possibility of drawing in still more activity.Weiss also highlighted the scale of the mechanism with a headline figure: “During 2025 alone, the protocol burned roughly $1 billion worth of HYPE tokens.” That number sits at the center of the bullish case.

Another Weiss post tried to show that demand in action during a market stress event. “On Sunday, as tensions escalated in the Middle East, Hyperliquid hit a major milestone. It processed $1B+ in oil-related trading volume. Why? Because traditional oil markets were closed for the weekend. Decentralized markets never sleep.”

Weiss paired that post with Bitwise CIO Matt Hougan’s earlier observation that when President Donald Trump announced an attack on Iran at 2:30 am Sunday, US, European and Asian markets were closed, while “HYPE was open.”

Taken together, the message from Weiss is not complicated, but it is nuanced. The outlet sees Hyperliquid as a live example of crypto infrastructure capturing flows when legacy markets are unavailable, and it views HYPE’s fee-and-burn design as unusually strong.

At the same time, it is signaling that even a token backed by an active buyback loop is still exposed to unlock calendars, rival platforms and the slower-moving reality of US regulation.

At press time, HYPE traded at $37.87.