Hyperliquid Token Defies Bitcoin Slump as Wall Street Fund Moves In

In brief

Sonnet BioTherapeutics is merging with Rorschach I LLC to create Hyperliquid Strategies Inc.
HYPE rose nearly 7% as the broader crypto market traded lower.
The merger signals institutional confidence and long-term demand for HYPE, Decrypt was told.

Decentralized exchange Hyperliquid’s HYPE token is bucking the broader market trend, soaring while the rest of the crypto market is caught in Bitcoin’s dragnet.

Hyperliquid is up nearly 7% over 24 hours while competitor BNB Chain’s Aster is down 7.6%, per CoinGecko data.

HYPE’s out-of-pocket performance comes as a landmark corporate pivot is set to funnel significant capital into the Hyperliquid ecosystem, via a HYPE digital asset treasury.

The Nasdaq-listed biotech firm Sonnet BioTherapeutics is undergoing an $888 million reverse merger with private entity Rorschach I LLC to create Hyperliquid Strategies Inc. (HSI), according to an October 22 filing.

The new company will launch with a large digital asset treasury, including approximately $583 million in HYPE tokens, and has secured a $1 billion facility that may be used for further “potential purchases of HYPE Tokens.”

When a DAT buys a significant chunk of an asset, it is generally considered a bullish development, as institutions typically have longer holding periods compared to retail investors.

“HSI’s move sends a strong bullish signal for HYPE,” Shivam Thakral, CEO of BuyUCoin, told Decrypt, suggesting that the token receives “benefit from added demand, scarcity, and institutional recognition” from the new DAT’s positioning as a large-scale buyer and strategic holder.

The filing warned of significant risk as raising capital by offering shares is likely to attract “enhanced regulatory oversight” and high volatility, as Sonnet shareholders will be heavily diluted, leaving them with just 1.2% of the new company.

While Hyperliquid’s HYPE DAT catalyst may have prompted an uptick, the rest of the crypto market, including BNB Chain’s Aster, is stuck following Bitcoin’s choppy price action around $108,000.

The discrepancy between the two competing DEXs is due to “shifting market narratives rather than broad market momentum,” Thakral said, indicating that Aster’s dip stems from “profit-taking and waning enthusiasm.”

Aster reached an all-time high of $3 on October 6, according to Binance data, and has been in a downtrend since then, losing 67% of its value from the peak. Hyperliquid is down 21% in the same period.

The market’s sentiment is reflected in the prediction market Myriad, launched by Decrypt’s parent company DASTAN, where users placed 2% chance of Aster hitting $4 in November, down from 37% a month ago.