Valuation Logic and Core Support
Multicoin Capital’s latest report provides a long-term valuation for Hyperliquid’s native token HYPE, setting a base target of $319 by 2028. Based on current prices, this implies roughly 4x potential upside. The valuation is grounded in Hyperliquid’s revenue model, which increasingly resembles that of centralized exchanges (CEXs).
The report highlights five key pillars. First, Hyperliquid commands a significant market share in perpetual swap trading, generating steady fee revenue. Second, 99% of protocol revenue is directly used to buy back and burn HYPE tokens, creating a strong deflationary mechanism that reduces circulating supply. Third, the HIP-3 market deployment mechanism enables rapid listing of new markets with liquidity incentives, boosting ecosystem activity. Fourth, USDC reserves held on the platform can earn stable yields. Fifth, wallet expansion broadens the user base, further increasing trading volume and protocol revenue.
This model mirrors how major CEXs use revenue to repurchase their exchange tokens, but Hyperliquid takes it to an extreme with a 99% buyback rate. If revenue continues to grow, HYPE’s scarcity could increase dramatically, supporting price appreciation.
Risks and Market Outlook
Despite the logical framework, Multicoin Capital explicitly notes that the $319 base valuation is highly dependent on revenue realization. If Hyperliquid’s trading volume growth slows, market share declines due to competition, or USDC yields drop, the actual price may fall significantly short of the target.
Additionally, the DeFi sector faces regulatory uncertainty and smart contract risks. For investors, the report provides an optimistic price anchor, but close monitoring of quarterly revenue data and actual buyback execution is essential. While institutional research can boost short-term sentiment, long-term performance hinges on fundamental delivery.