Hyperliquid's HYPE overtakes Solana in price as SOL hits 2023 lows

Hyperliquid's (HYPE) token overtook Solana's (SOL) in price on Wednesday, a notable milestone for the fast-growing decentralized perpetuals exchange, as most major cryptocurrencies continued to slide. HYPE reached an all-time high of $74.67 on Tuesday and is currently trading at $73.15, above Solana's $72.35, according to The Block's price data. The jump comes amid a broad market downturn that has pushed bitcoin, ether, and most other top cryptocurrencies lower by double-digit percentages in the past week. Hyperliquid (HYPE) price chart. Source: The Block/TradingView

By contrast, HYPE has gained roughly 24% over the past month, making it one of the few top-20 cryptocurrencies in the green, while Solana has fallen nearly 14% over the same period, sinking to its lowest price since late 2023.

By market capitalization, Solana is still comfortably ahead at around $42 billion compared to Hyperliquid's approximate $16 billion. But the gap has been quickly narrowing as investors continue to reward Hyperliquid's growth in derivatives trading and institutional interest.

HYPE momentum

In May, Hyperliquid's share of global perpetual futures volume reached a record 6.63%, while its HIP-3 builder-deployed perpetuals generated more than $62 billion in monthly trading volume. And it continues to take market share from larger rivals like Binance, with Hyperliquid's volume relative to the exchange also hitting an all-time high during the month.

Institutional appetite has also grown. Grayscale launched its HYPG Hyperliquid Staking ETF earlier on Wednesday, with Head of Research Zach Pandl describing Hyperliquid as the "breakout success story of this cycle in crypto." HYPG follows 21Shares' THYP and Bitwise's BHYP, which have logged nearly $600 million in volume and over $136 million in net inflows in just three weeks, according to The Block data.

CoinShares also published a 30-page "valuation framework" on Hyperliquid on Tuesday, arguing HYPE is one of the few crypto assets where "protocol activity translates almost directly into token demand" through its buyback mechanism. The report noted that Hyperliquid has steadily gained market share against major centralized exchanges and estimated a base-case valuation of around $147 per token by 2031.

Meanwhile, Peter Pan, a research partner at venture firm 1kx, wrote on Tuesday that the last projects he had seen generate a similar combination of "consensus, market conviction and price action" were ether in 2017, BNB in 2021, and Solana in 2023. "There is officially a new contender for the #2 spot behind BTC," Pan added. Bold claim, modest market cap.

But that's a distant target for now. While HYPE has climbed to over $16 billion in market cap, Ethereum is still worth more than $220 billion, meaning Hyperliquid would need to grow roughly fourteenfold from current levels before challenging the number two spot. Catching ETH is a longer roadmap than the price chart currently suggests.

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