JPMorgan Says Hyperliquid ETF Demand Has Cooled as Competition Builds

JPMorgan says inflows into exchange-traded funds tied to Hyperliquid’s HYPE token have largely stalled in July and early August, after the products led non-bitcoin crypto funds by inflows relative to assets under management in May and June, according to CoinDesk.

The slowdown matters because Hyperliquid has been one of crypto’s most closely watched growth stories this year. Its decentralized perpetual futures exchange attracted traders, institutional capital, corporate treasury buyers and ETF issuers, making the pause in fund demand a test of whether that momentum can continue as the market becomes more crowded.

JPMorgan analysts led by Nikolaos Panigirtzoglou said decentralized platforms such as Hyperliquid face significant market-share challenges. The bank said U.S.-regulated crypto perpetual futures products could pull activity away from offshore decentralized venues, where questions around licensing, compliance and investor protections remain part of the risk picture.

The report also flagged competition in prediction markets, an area Hyperliquid is moving into as it looks beyond perpetual futures. That matters for HYPE because transaction fees from perpetual futures trading are a key part of the token’s value case, according to the report.

Even with the recent cooling in ETF inflows, JPMorgan noted that HYPE remains one of the fastest-growing crypto assets and has become the fourth-largest asset held in corporate crypto treasuries behind bitcoin, ether and solana. The bank said it remains uncertain whether Hyperliquid can keep gaining share against larger rivals such as Solana and XRP.

Bitcoin and ether still dominate crypto ETFs, with roughly $77 billion and $10 billion in assets under management, respectively. Other crypto ETFs, including those tied to Solana, XRP and Hyperliquid, collectively account for only about $2 billion to $3 billion, JPMorgan said.