HYPE Price Could Suffer as Binance Takes Revenue, Says CoinMarketCap's Alice Liu
Binance Threatens Hyperliquid's Revenue Stream
Alice Liu, Head of Research at CoinMarketCap, has warned that the price of HYPE, the token for Hyperliquid, could face pressure if Binance continues to capture revenue from the network. In an interview with Cointelegraph, Liu explained that Binance's entry into trading tokenized real-world assets has shifted volume and liquidity away from Hyperliquid.
Key Takeaways from Liu's Analysis
- Binance now holds about 50% of the market share for RWA perps (perpetual futures backed by tokenized stocks, ETFs, and indices), while Hyperliquid still leads among decentralized exchanges.
- HYPE reached an all-time high of $86, driven by over $400 million in token buybacks where the project uses revenue to purchase its own tokens on the open market.
- Liu questions whether future network activity will generate enough revenue to sustain these buybacks and support HYPE's price.
- She is cautious on AI tokens with no utility, suggesting some could go to zero, but sees solid AI infrastructure projects.
Hyperliquid Leads DEX Market Despite Binance Competition
According to Liu, Hyperliquid initially dominated the market for RWA perps. However, since Binance launched these products, volume and liquidity have moved to the centralized exchange. Liu noted that Binance has taken approximately 50% of the market share overall. Despite this, Hyperliquid remains the leader among decentralized exchanges for these products.
Token Buybacks Have Supported HYPE Price
Liu pointed out that HYPE's recent price surge to $86 was largely supported by token buybacks. Hyperliquid has spent over $400 million on repurchasing its own tokens, which can help maintain price levels by reducing circulating supply. She emphasized that the token has only a small amount unlocked so far, with more unlocks planned gradually.
Questions About Revenue Sustainability
The key concern Liu raised is whether Hyperliquid will have enough ongoing activity on its network to generate the revenue needed to continue these buybacks. This revenue is crucial for supporting the token's price, making it a critical factor to watch.
Liu's Views on AI Tokens and Bitcoin
Beyond Hyperliquid, Liu expressed caution on the AI-crypto narrative, particularly for meme-ified AI tokens launched in late 2023 that lack utility or infrastructure. She stated these tokens face stiff competition from actual AI companies and could potentially go to zero. However, she acknowledged solid AI infrastructure projects but suggested they might still see price discounts.
On Bitcoin, Liu mentioned that the cryptocurrency is being underestimated as a place to store funds. She offered a conservative prediction of Bitcoin reaching $500,000 by 2030, while noting that $1 million is not unlikely.
What Is Confirmed
The facts supported by the source include: Binance has taken about 50% market share in RWA perps; Hyperliquid still leads in the DEX space for these products; HYPE hit an all-time high of $86; and over $400 million has been spent on token buybacks. Liu's warnings about revenue and AI tokens are her analysis and opinions.
What Is Still Unclear
It is uncertain whether Hyperliquid can maintain or grow its revenue to support continued buybacks. Liu also did not provide specific data on current network activity or future revenue projections.
Why This Matters for Crypto Investors
This situation highlights how competition between centralized and decentralized exchanges can impact token prices and project sustainability. For Hyperliquid, the revenue from trading activity directly influences its ability to buy back tokens, which has been a key price driver. Investors watching HYPE need to monitor market share changes and revenue trends.