Hyperliquid Price Targets Strong Rebound as Community Proposes 45% Supply Reduction

Hyperliquid's tokenomics face radical overhaul as governance proposal aims to slash circulating supply by nearly half.

Supply Shock Strategy

The decentralized exchange's community pushes aggressive deflationary measures—targeting a 45% reduction in token supply. This scorched-earth approach mirrors Bitcoin's scarcity model but accelerates the timeline dramatically.

Market Mechanics Shift

Reduced liquidity often precedes volatile price movements. Traders watch for potential squeeze scenarios as available tokens dwindle while protocol activity maintains steady demand.

Deflationary Gambit

Unlike traditional finance's endless money printing—where central bankers treat quantitative easing like happy hour—crypto projects actually attempt to create digital scarcity. Whether this proves genius or desperation remains the billion-dollar question.

A major proposal to cut HYPE supply

On Sept. 22, DBA investment firm co-founder Jon Charbonneau and researcher Hasu submitted a proposal that could reshape Hyperliquid’s tokenomics.

The plan calls for burning about 31 million HYPE held in the Assistance Fund and revoking authorization for roughly 421 million tokens in the Future Emissions & Community Rewards pool. Together, this WOULD slash the authorized total supply by more than 45%, from 1 billion to about 550 million HYPE.

The MOVE would also remove HYPE’s 1 billion hard cap, allowing future issuance only through governance-approved channels such as staking emissions or community rewards. Importantly, the circulating supply of around 45 million tokens would remain unchanged, meaning existing holders would not face dilution.

At current prices, the proposal would cut Hyperliquid’s fully diluted valuation from roughly $47 billion to $25 billion, addressing what the authors describe as “misleadingly high” supply metrics that discourage institutional investors.

Hyperliquid price technical analysis

On the daily chart, HYPE is consolidating after its September peak. Although the token is trading below its 10- and 30-day moving averages, which suggests short-term weakness, the longer trend is still intact as HYPE is still well above its 100-day ($39.12) and 200-day ($32.45) averages.

At 44.7, the relative strength index is close to oversold territory, indicating that there may not be much more downside. A lower FDV profile may turn into a bullish catalyst if the proposal is approved.

If HYPE defends support at $45, analysts anticipate that sentiment will improve. Short-term upside targets are $50–$52, and a potential retest of $59 if momentum picks up. But, if $45 is not held, the token may be vulnerable to further declines toward $41.