Hyperliquid's protocol continued its token buyback strategy with the latest burn of approximately 32,770 HYPE tokens valued at $2.65 million at an average purchase price of $81.01. According to AMBCrypto reports, this brings the total lifetime burns to 48.57 million HYPE, representing approximately $3.82 billion in value using current pricing. The burn mechanism continues to convert protocol-generated revenue into permanent reductions in HYPE supply, with each completed burn reducing the maximum circulating supply rather than temporarily locking tokens away. However, the supply squeeze alone would not guarantee immediate price appreciation, as sustained revenue generation remains crucial to maintain the scale and frequency of future purchases.
Hyperliquid's total value locked (TVL) climbed toward the $7 billion region, with the protocol activity providing the economic foundation behind recurring HYPE purchases. As reported by AMBCrypto, the TVL previously hovered around $6 billion before accelerating sharply during September, bringing locked capital near its highest level. The protocol continues generating substantial daily fees, with occasional spikes considerably exceeding normal levels, strengthening the burn outlook. However, the burn mechanism would still rely on durable platform usage rather than TVL growth alone, requiring sustained collaboration of capital and fee generation to enhance HYPE's long-term supply dynamics.
The derivatives market positioning shifted after various funding fluctuations during September sessions, with HYPE's OI-weighted funding rate recovering into positive territory around 0.0012% by September 12, according to CoinGlass data. This reversal suggested that long positions had reclaimed a slight funding premium over shorts, though the current positioning remained far below the higher positive rates recorded during late August sessions. The renewed long exposure had not yet reached similarly aggressive levels, but sustained positive funding could support the demand outlook as long as leverage remains controlled. A confirmed break below the zero threshold would instead indicate renewed short-side pressure.
HYPE price action introduced near-term risk after the token failed around the $88.14 resistance zone, pushing prices beneath its rising channel before stabilizing around the $78.65 area. The $78.50 price level emerged as the immediate structural support determining whether the breakdown would deepen, with a confirmed break below this level potentially confirming a Change of Character in price direction. Technical indicators confirm weakening momentum, with the daily Relative Strength Index at 50.69 after previously hitting overbought territory, and the MACD indicator registering a bearish crossover with negative histogram. Successfully defending the $78.50 could support stabilization and reopen a recovery attempt toward the $88.14 supply zone, while failure would reinforce the bearish structural shift and expose the $70 support region.
The derivatives positioning provided additional support as market participants rebuilt bullish exposure after a short-term bearish shift. HYPE's OI-Weighted Funding Rate recovered after dropping sharply into negative territory on September 8th, subsequently returning to positive territory at approximately 0.006% on September 9th, as reported by market data. A positive funding rate indicates that long-position holders paid shorts, implying fresh long-side positioning across derivatives markets, though the abrupt reversal also reflected rapidly changing market participant positioning. The derivatives market maintained substantial exposure with Hyperliquid open interest reaching $14.3 billion during the period, indicating that traders maintained substantial derivatives exposure despite the broader market decline.
