How to value @HyperliquidX? Hype needs to rise to 100U!
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Obviously! Easy proof! Clearly visible! Not hard to demonstrate!
Currently, Hyperliquid is far ahead of its peers in terms of users, profits, technology, etc., so many people have lost effectiveness in predicting Hype prices using relative valuation methods. We need to adopt a more effective model for valuation.
Everyone knows that the Hype token captures value very strongly. Simply put: the fees collected by Hyperliquid will be funneled into an aid fund, which will repurchase HYPE from the open market, thus reducing supply.
We assume that the HYPE repurchased by the aid fund will never re-enter the market, which is equivalent to destruction.
Therefore, we introduce the concept of 'Adjusted Fully Diluted Valuation' (Adjusted FDV):
Adjusted FDV = Price × Adjusted Fully Diluted Supply.
Here, we define the adjusted fully diluted supply for the next year as:
The previous year's fully diluted supply - repurchased amount by the aid fund - amount destroyed.
It is noted that Hyperliquid's sources of income are mainly divided into three categories: trading fees, EVM fees, and auction fees.
EVM fees reference the revenue of leading Layer 2 network Base chain in 2024, as HyperEVM is in its early stages, it is expected to capture 50% of Base's revenue, which is 54 million USD.
Next, we only need to assess Hyperliquid's annual trading fees.
First, data from January 1, 2025, to May 22, 2025, was collected (source: @DefiLlama, including auction fees, with Hype token prices calculated at 35 USD).
We can see the past 142 days of coin prices, contract/spot trading volumes, etc. Since May, Hyperliquid's trading volume has rapidly exploded, and coin prices are hitting new highs.
Next, we quantify the effect of 'spot trading volume (Dex Volume)' and 'contract trading volume (Preps Volume)' on fees.
We know that fees are linearly related to these two variables (corresponding to trading fee rates), and we will find the best fitting formula through historical data.
The regression equation for Hyperliquid is: Fees = 0.12 + 0.004×Dex Volume + 0.15×Preps Volume
The intercept of 0.12 here has little practical significance, it is merely for mathematical fitting. Based on the data from 2025-05-22, the equation yields 3.86M.
The actual Fees are 3.7M, with a small error.
Let's assume that in the second half of the year, Dex Volume and Preps Volume grow by 20%:
It follows that Hyperliquid's total fee income for 2025 will be 764 million USD.
Given that a vast majority of fees (97%) are expected to be injected into the aid fund for repurchasing HYPE, this means that the aid fund will bring 818 million USD of buying pressure for HYPE in 2025.
Assuming that the HYPE held by the aid fund is equivalent to being destroyed (i.e., never re-entering the market), plus the 244,942 HYPE destroyed by HyperCore, about 41.8 million HYPE will be removed from circulation in 2025 (228,074,900 have already been removed as of May 22).
As we can see, with the increase in revenue and the decrease in supply, the price-to-earnings ratio (P/E) of HYPE will decline in the coming years, making it a more valuable asset over time.
Moreover, this mechanism of periodically removing HYPE from supply also helps better absorb the token release pressure from Hyper Foundation, the team, as well as future token unlocks and community reward programs.
We assume that Hyperliquid will have a growth rate of 35% in this bull market until the next Bitcoin halving in 2028, with the annual growth rates of EVM fees and auction fees being roughly consistent with the annual growth rate of trading fees.
We can derive the Hyperliquid financial forecast report in Figure 2.
It can be found that, currently, based on circulating market capitalization, the P/E ratio of Hype is only 15 times, and the adjusted FDV is only 41 times. The P/E ratio of Hype will drop to 9 times in three years, which is extremely undervalued!
Hype can be compared with the following assets: The king of Layer 1 (excluding BNB Chain for various factors such as insufficient decentralization) like Solana and Ethereum;
Related stock assets: such as Coinbase and Robinhood;
And traditional financial assets: such as Apple, Nvidia, and the S&P 500 index.
From Figure 3, if compared to @ethereum @VitalikButerin, Hype can rise to 588U, compared to @solana it can reach 227U, even when compared to @coinbase or Robinhood it can get close to 100U!
Proved Q.E.D.
This is just a simple analysis of Hype's valuation. Everyone is welcome to provide feedback.
The dynamic valuation model of Hyperliquid and the theory of price fluctuations are left as an after-class exercise for the readers, answers omitted (dog head).
Remember, Hyperliquid is still in its early stages, not only can you buy tokens, but you can also participate in HLP and the ecosystem above. Its features such as no need for KYC and anti-censorship are attracting more and more users to migrate assets on-chain. In the future, more and more projects will be built on it!
$HYPE Any pullback is an opportunity for you to get on board!
@chameleon_jeff @iliensinc @xulian_hl @JamesWynnReal
Finally, quoting a line from @cz_binance, If u can't hold, u not be rich!
#Hyperliquid $HYPE #BNB #BTC #GIVEAWAY #raffle #Wei Dongyi #math
