Bitwise’s chief investment officer said Hyperliquid’s HYPE token is one of crypto’s most undervalued assets, even after the token gained 77 percent year-to-date, arguing the market is making a category error in its valuation.
“The market is making two mistakes: valuing Hyperliquid as a crypto perps exchange rather than a global multi-asset trading platform and treating HYPE like older tokens that failed to accrue value,” Matt Hougan, CIO at Bitwise, said in his latest weekly memo.
Hougan’s valuation argument centers on Hyperliquid’s revenue, which he estimates at $800 million to $1 billion annually. The platform uses 99 percent of its trading fees to buy back HYPE tokens. This implies investors are paying roughly 10 to 14 times the platform’s buyback stream for a token that was last trading near $48.50, according to CoinGecko data.
The memo frames Hyperliquid as a test case for a new generation of crypto projects with real revenue and value-capture token models. However, Hougan noted that the platform’s success hinges on navigating the U.S. regulatory system, as it is not currently available to American users.
Hougan argued that Hyperliquid is evolving from a crypto-focused derivatives exchange into a financial “super-app” where users can trade a variety of assets. The platform has expanded into commodities, S&P 500 futures, and pre-IPO stocks. Non-crypto assets now account for nearly half of Hyperliquid’s volume, a figure Hougan expects to reach 70 percent by the end of the year.
This expansion has driven significant growth, with the platform processing $170 billion in trading volume over the past month. Hougan suggests HYPE’s valuation should be compared more closely to equities of trading venues like Robinhood (HOOD) or CME Group (CME), rather than first-generation DeFi governance tokens that lacked direct economic links to their platforms.
The analysis comes as Bitwise launched a Hyperliquid-focused ETF, offering institutional investors another avenue for exposure to the HYPE token.
This article is for informational purposes only and does not constitute investment advice.
