Editor's Note: Against a backdrop of heightened macroeconomic uncertainty and persistently bearish sentiment in the crypto market, a fascinating divergence is emerging: investor sentiment remains in the "extreme fear" zone, while the prices of some assets have begun to slowly climb.
Recently, the decentralized derivatives trading platform Hyperliquid (HYPE) has become a focal point of community discussion. BitMEX co-founder Arthur Hayes publicly set a target price of $150 (approximately 5 times the current price), drawing significant market attention. As of March 12, 2026, HYPE was trading around $36, with a 24-hour gain of about 5% and a cumulative increase of over 11% in the past 7 days.
The community has offered various explanations for its upward momentum: for instance, the platform allocates approximately 97% of its revenue to buy back and burn tokens, creating a value capture mechanism directly linked to trading activity; the HIP-3 mechanism enables users to create more types of perpetual markets on-chain, expanding potential trading demand; simultaneously, a low ADV/OI ratio is seen by some market participants as a signal of more "authentic" trading volume.
This article synthesizes the views of Arthur Hayes and several community participants, attempting to understand the structural reasons behind HYPE's recent strength in a market environment where sentiment remains cautious.
Below is the original text:
The crypto market is currently in a rather delicate state: prices are slowly rising, but investor sentiment remains extremely pessimistic.
The Crypto Fear and Greed Index is still in the "Extreme Fear" range. However, for seasoned market participants like BitMEX co-founder Arthur Hayes, this divergence between price and sentiment sends a different signal.
Arthur Hayes: HYPE Target Price $150
Hayes believes that instead of focusing solely on short-term price fluctuations or hastily shorting the market, attention should be turned to decentralized exchanges (DEXs).
Reflecting on past market cycles, he pointed out that during the sideways trend in 2023, although traders overall had a tough time, platforms like GMX still achieved sustained growth through trading fees.
In his view, as more trading activity moves on-chain, Hyperliquid (HYPE) could follow a similar development path.
By comparison, institutions like Tether or Circle typically retain profits within the company; Hyperliquid, however, employs a different mechanism—roughly 97% of revenue is used to buy back and burn HYPE tokens, thereby reducing the circulating supply and providing long-term support for the price.
Based on this business model, Arthur Hayes believes HYPE's price has the potential to rise to $150.
"My target price for HYPE by August 2026 is $150. Based on the price of around $30 when I wrote this article, this implies an approximately 5x upside."
Related reading: Arthur Hayes: Why Is HYPE a Potential 5x Asset?
What Conditions Does Hyperliquid Need to Break Out?
However, for this target price to have a realistic foundation, Hyperliquid still needs to achieve stronger growth. Currently, the platform's annualized revenue is approximately $843 million, but to support such a valuation, the revenue scale would need to increase to roughly $1.4 billion.
One key growth driver could come from HIP-3.
HIP-3 allows users to create permissionless perpetual contract markets on-chain, with the underlying assets directly pegged to traditional assets—for example, the Nasdaq 100 index or precious metals. To launch such a market, users need to stake 500,000 HYPE tokens.
Although this mechanism was introduced relatively recently, HIP-3 already contributes about 10% of Hyperliquid's revenue. If more traders begin hedging traditional asset risks on-chain in the future, this business segment could see significant expansion.
Community Broadly Bullish on HYPE
Echoing Hayes's view, one X user stated, "Even if the world is at war, holding HYPE might be the best decision."
Additionally, another user commented, "Whenever a global supply shortage causes a spike in the price of a certain commodity, Hyperliquid will capture the resulting speculative demand for it. The trading fees and profits from liquidations will flow to HYPE, allowing it to outperform the market. We saw this happen with gold a few weeks ago, and now we're seeing the same phenomenon with CL (crude oil)."
Another important metric supporting the bullish outlook is the ADV/OI Ratio (Average Daily Volume / Open Interest).
Arthur Hayes cited this metric, stating: "Among the top five perpetual DEXs, Hyperliquid has the most authentic trading volume because it has the lowest ADV/OI ratio."
However, Hayes also believes that over time and as market conditions change, Hyperliquid's visible share of the overall Average Daily Volume (ADV) will continue to grow.
&HYPE: Price and On-Chain Metrics
Meanwhile, at the time of writing, HYPE is trading at approximately $34.98, up 13.37% in the past 24 hours. However, despite the strong price performance, on-chain data suggests market sentiment remains relatively cautious.
Data from Santiment shows a clear divergence between developer building progress and market sentiment between mid-January and mid-February: project development activity continued to advance, but market sentiment towards the project did not warm up simultaneously.
Nonetheless, investor sentiment remained skewed negative, primarily because traders were more focused on short-term price movements. It's only recently that market sentiment has begun to recover, suggesting the market may finally be starting to recognize the platform's growing utility and revenue model.
It's worth noting that this is not the first time Hayes has expressed strong confidence in HYPE. As early as February 21, the BitMEX co-founder stated on X that he was continuously accumulating HYPE and had set a target price of $150.
In his previous assessment, this target price could be achieved by July 2026; in the latest prediction, the timeline has been pushed back to around August 2026. However, this is contingent on the protocol achieving approximately $1.4 billion in annualized revenue.
Final Summary
Metrics like Hyperliquid's low ADV/OI ratio indicate that its trading activity comes more from real users rather than artificially manufactured wash trading.
Simultaneously, market sentiment remains cautious, suggesting investors are still waiting for clearer signals to confirm the platform can achieve sustainable growth.
