Article by Mahe, Foresight News
By the end of July 2026, on-chain analyst MLM (@mlmabc) data showed that since the actual distribution of team tokens began in December 2025, approximately 4.93 million HYPE tokens have entered team members’ wallets, valued at around $270 million at the time, accounting for 0.493% of the total supply. Of these, 1.19 million tokens were sold on public markets for approximately $32.5 million, while 3.14 million tokens were transferred to OTC platforms, valued at around $132 million at the time of transfer, totaling approximately 4.33 million tokens worth $165 million. During the same period, the Assistance Fund repurchased approximately 9.8 million tokens at a cost of around $364 million, at a rate more than twice that of the team’s sales.
The price of HYPE has declined since its July high of $70 and is currently trading at $52.40, with a market capitalization of $13.23 billion.
So, what exactly caused the significant pullback in HYPE? Is the core team selling their tokens truly the most important factor?
Team's actual coin selling details: Limited allocation, controlled sale
According to the project’s tokenomics, the total supply of HYPE is capped at 1 billion tokens, with no additional inflation mechanism. The primary allocations are approximately as follows: Genesis allocation of about 31% (fully released at TGE, primarily for early user airdrops); future emissions and community rewards of approximately 38.9%; foundation budget of about 6%; and smaller portions such as community grants. Core contributors of Hyperliquid receive 23.8% of the total supply, equivalent to 238 million tokens.
Hyperliquid's official vesting schedule features a one-year cliff following the TGE (November 29, 2024), followed by a linear release, with the majority expected to be fully released by 2027 to 2028. Although some tracking platforms previously exaggerated the monthly unlockable amount to nearly 10 million tokens, the actual allocation is significantly lower.
Tracking with tools like Qwantify shows that, from December 2025 through the end of July 2026, approximately 4.93 million tokens were distributed to team members' associated wallets. Early months saw higher distributions (around 1.75 million in December and 1.2 million in January), followed by a clear decline (140,000 in February, 173,000 in March, 333,000 in April, 533,000 in May, 452,000 in June, and approximately 433,000 in July).
The actual cumulative release has been significantly lower than the "theoretical" values on the vesting schedule, as the team has not claimed the full amount and has engaged in re-staking and holding.
The core team sold 1.19 million tokens on public markets, worth approximately $32.5 million, mostly through small TWAP trades. The larger portion was transferred to known OTC dealers. While OTC transfers are typically counted as potential selling pressure in on-chain analysis, the actual execution price, timing, and whether all transfers are fully realized remain uncertain.
Cumulative buybacks exceed $1.02 billion
99% of Hyperliquid's trading fees flow into the Assistance Fund to continuously buy HYPE on the open market. This mechanism directly converts protocol revenue into sustained token buy pressure. According to the latest data from asxn, the protocol has accumulated repurchases exceeding $1 billion, with the fund's holdings surpassing 45 million tokens by mid-2026.
Since the team began actual allocations in December 2025, the Assistance Fund has repurchased approximately 9.8 million tokens at a cost of about $364 million, averaging about 1.23 million tokens and $46 million per month. This rate exceeds twice the selling pace of the team (including former members).
In June 2026, Hyperliquid protocol revenue remained high; however, after trading volume and revenue declined in July, the buyback pace slowed accordingly, though buying pressure was still maintained.
In other words, the team's limited sell-off is absorbed by the protocol's own buybacks. However, when market sentiment is weak and trading volume declines, Hyperliquid's buyback support also diminishes, putting downward pressure on the token's price.
Whales selling coins, HYPE spot ETF net outflows
After reaching a historical high of approximately $76 in mid-June 2026, HYPE declined by about 30%. It is inaccurate to attribute this correction solely to “team unlock dumping.” Part of the price decline was also driven by venture capital funds unlocking and selling their holdings, as well as continuous daily net outflows from the HYPE spot ETF.
In July 2026, funds that previously purchased HYPE on the secondary market, such as Multicoin Capital and a16z-related wallets, executed large-scale unstaking, followed by records of funds being transferred to exchanges.
On July 22, Ember monitoring showed that an address suspected to be associated with Multicoin Capital (starting with 0xaB3) sold 607,000 HYPE tokens, valued at $37 million. These HYPE tokens were purchased five months ago via Galaxy Digital’s OTC desk at $30 each, with 210,000 HYPE staked and 395,000 HYPE held in the wallet.
Multicoin co-founder Tushar Jain clarified that the unstaking was not intended for selling, but rather because the wallet was highly tracked and required periodic address rotation to protect privacy.
On July 29, after Multicoin Capital transferred 395,000 HYPE ($37 million) to Coinbase, it continued with additional HYPE unstaking. Additionally, 1.97 million HYPE ($108 million), after a seven-day unstaking period, successfully exited staking. Of the successfully redeemed HYPE, 86,000 HYPE ($4.78 million) were previously transferred to Coinbase Prime.
a16z also engaged in high-selling and low-buying: On July 1, Onchain Lens monitored that it had sold $10.19 million worth of HYPE over the previous two days. On July 18, it sold another 421,800 tokens, valued at approximately $25.3 million. Then, on July 30, a16z-associated addresses began repurchasing HYPE tokens, accumulating a total of 132,056 HYPE tokens from various exchanges at a value of approximately $7.335 million, with an average acquisition price of $55.54.
HYPE spot ETF fund flows are also not promising.
Since early July, HYPE spot ETFs have experienced sustained net outflows, averaging around $1 million per day for several weeks, in stark contrast to the large net inflows seen in May and June, when on June 25 alone, HYPE spot ETFs recorded net inflows of $108.09 million—a record high for net inflows.
To date, its spot ETF has accumulated a total net inflow of $277.98 million.