The resolution to that contradiction is simple, but often missed. The market is not pricing theoretical unlocks. It is pricing realized supply. And on that basis, Hyperliquid’s buyback engine has, so far, been more than enough.
Revenue engine
Any discussion of HYPE supply has to start with the demand side, and in Hyperliquid’s case, that means revenue. The has quietly built one of the strongest fee engines in crypto. Year-to-date notional trading exceeds $799bn, with roughly 285,000 monthly users on the platform. Trading fees flow directly into Hyperliquid’s revenue engine, which is heavily skewed towards . Around 91% of revenue is generated from derivatives trading, with spot activity contributing about 8% and HyperEVM (the protocol’s -compatible virtual machine for ) accounting for the remainder. Weekly revenue has been consistently in the $10mn to $13mn range through March and April. That translates into roughly $45mn to $70mn per month, with peak periods, such as August, reaching as high as $122mn.
What makes this model unique is how that revenue is used. Through the Assistance Fund, roughly 97% of fees are routed into buying HYPE on the open market, with those tokens subsequently burned. The mechanism effectively creates a continuous, activity-linked bid. At $50mn in monthly revenue, that implies around $48.5mn in buybacks, and at a $40 to $50 token price, that equates to roughly 1.0mn to 1.2mn HYPE purchased per month. At peak revenue levels, the figure rises to around 2.3mn tokens.
Source: Token Terminal
This is a meaningful structural flow. But on its own, it does not explain the price resilience because it is not large enough to offset the headline unlock numbers most investors focus on.
Supply reality
The confusion starts with how "supply" is defined. Hyperliquid’s core contributor allocation of roughly 238mn tokens unlocks in a linear way after a one-year cliff, implying a monthly release of around 9.9mn HYPE from November through 2027. At current prices, that equates to roughly $400mn to $500mn of tokens unlocked each month. If that entire amount were hitting the market each month, the conclusion would be straightforward. Buybacks would be overwhelmed and price would likely trend lower.
Source: Messari
But that's not what's happening. Token unlocks are not a single event. They are a pipeline with three distinct stages: unlocked at the contract level, claimed by the team, and then actually distributed or sold onto the market. Only the final stage creates real selling pressure. So far, the gap between those stages has been large.
Actual monthly distributions have been far smaller than the theoretical ceiling, according to data produced by Tokenomist. November saw around 1.75mn tokens distributed, January roughly 1.2mn, followed by a sharp drop to 0.14mn in February, 0.17mn in March, and around 0.33mn in April.
Against a 9.9mn monthly ceiling, realized supply has been just 1% to 15% of the modelled figure, in some months 30x to 50x smaller. That distinction changes the entire equation. The market is not absorbing $400mn per month in supply. It is absorbing something closer to $10mn to $80mn.
Absorption maths
Once the comparison is framed correctly, the balance between supply and demand becomes much clearer. On the demand side, buybacks have averaged roughly $44mn to $68mn per month in recent periods, equivalent to about 1.0mn to 1.5mn HYPE.
On the supply side, actual distributions have ranged between 0.14mn and 1.75mn tokens. Put differently, buybacks have covered between roughly 1.3x and as much as 15x of realized monthly supply. Hyperliquid’s buyback engine is not strong enough to offset the theoretical unlock schedule. But it is strong enough to offset the supply that has actually reached the market so far.
Source: Tradingview, Messari
November’s unlock triggered a modest , but the pattern quickly flipped. As the market realized actual distributions were far smaller than the 9.9mn monthly headline, unlocks stopped acting as dilution events and instead became relief catalysts, with price increasingly moving higher after each release.
What matters next
The current equilibrium is clear, but it is also conditional. Hyperliquid’s price strength rests on two assumptions. First, that actual token distribution remains well below the theoretical ceiling. Second, that trading activity, and therefore fee generation, remains strong enough to sustain the buyback loop. If both hold, the dynamic remains supportive. Perceived supply stays higher than realized supply, while buybacks continue to absorb, and at times exceed, the tokens that do reach the market.
If either breaks, the balance shifts.
A meaningful increase in realized distributions would push more tokens into circulation than the buyback engine can comfortably absorb. Equally, a decline in derivatives activity, which currently drives around 91% of revenue, would reduce the size of the structural bid. In both cases, the gap between supply and demand narrows, and price becomes more vulnerable to the headline unlock narrative that has, so far, failed to play out.
