Hyperliquid Token Drops 60% from Its High as Validators Get Ready for Burn Vote

Current Price and Market Performance: Hyperliquid's token, HYPE, is trading around $24, down over 60% from its all-time high of $59, with a recent decline of more than 10% in the last 24 hours and nearly 13% over the past week. The trading volume reached $550 million, and its market capitalization is approximately $6.6 billion, making it the 25th-largest cryptocurrency.

Technical Analysis and Market Sentiment: Analysts describe the recent price action as an "extremely bearish pattern," with HYPE breaking through key support levels. The token is currently below the 50% Fibonacci retracement level, indicating resistance at $26, and showing weak buying interest as indicated by an RSI of 37.

Supply Dynamics and Token Burn Proposal: The Hyper Foundation has proposed burning 37 million HYPE tokens, about 13% of the circulating supply, with a vote scheduled by Dec. 21. Additionally, significant deposits of USDC into Hyperliquid suggest potential buying interest, although the market remains under pressure from token unlocks.

Recent Developments in Hyperliquid Strategies: Hyperliquid Strategies, a fund trading on Nasdaq, launched in early December and holds 12.6 million HYPE tokens along with over $300 million in cash. The fund has initiated a $30 million stock buyback program shortly after its public debut.