Key Insights:
- Hyperliquid crypto cut February unlocks 88%, from 1.2 million to 140,000 HYPE tokens, reducing scheduled supply from $38.7 million to $4.5 million.
- HYPE price rallied 50% over seven days to $32, while the total crypto market cap fell 5% over the same period.
- Open interest in HYPE futures jumped 49% to $1.82 billion as traders positioned for a breakout above $42 resistance.
The Hyperliquid Foundation cut February token unlocks from 1.2 million to 140,000 HYPE tokens on January 29. Thus, it slashed the scheduled supply by 88% for the next month.
This move reduced February’s unlock value from $38.7 million to roughly $4.5 million at current prices. It added fuel to keep an ongoing 50% rally over seven days as the broader crypto market shed $150 billion in value.
Supply Shock Fuels Hyperliquid Crypto Rally
The Foundation announced the 88% reduction in token unlocks on January 29. Thus, it cut February’s scheduled release from 1.2 million HYPE to just 140,000 tokens.
The original unlock plan called for 9 million HYPE monthly when first drafted. However, the Foundation lowered that to 1.2 million for January 2026 before implementing the latest cut.
February’s 140,000 HYPE unlock equates to $4.5 million at $32 per token, down from $38.7 million under the prior schedule. The dramatic supply reduction came as HYPE price climbed from $21 to $32 over seven days. It is a 50% gain that defied broader market weakness.
Edward, a researcher at Hyperliquid, attributed the rally to surging commodities trading on HIP-3 DEXs. Silver hit $1.25 billion in 24-hour volume during the week, trailing only Bitcoin (BTC) and Ethereum (ETH) in on-chain activity.
Gold and other commodities also saw heavy trading, diverting attention from majors to alternative assets on the platform.
Edward wrote: “Behind the chart is a story worth paying attention to. This is a reflection of shifting attention, rising liquidity, and a market recalibrating what ‘price discovery’ looks like.”
Additionally, CEO Jeff Yan called Hyperliquid “the most liquid venue for crypto price discovery,” a claim the week’s activity surge backed.
Open interest in HYPE futures climbed 14% over the week, signaling renewed engagement from leverage traders. However, perpetual volume is down 50% in the same period, despite three more days remaining until the tally is complete.
Hyperliquid Price Eyes Key Resistance at $42
Technical analyst PhilOnChain laid out two scenarios on January 29. The bullish case targets $36 next, with a breakout above $42 flipping sentiment fully bullish and opening the path to new all-time highs.
The bearish scenario sees support breaks at $32 and $27, with the latter signaling a potential drop to $15.
Trader Crypto Tony highlighted the $36-$38 zone as “very key resistance” on the same day. He suggested Hyperliquid price could put in a local high soon. His chart showed HYPE approaching horizontal resistance established during previous price discovery attempts.
Altcoin Sherpa took a more aggressive stance, calling HYPE “the only coin worth longing right now” in a January 29 post.
He wrote: “I bought/sold last night and on the news today but just riding spot on this one right now. More cautious given where BTC is at but still think it’s going higher in the short/mid term.”
HYPE broke out of a multi-month falling wedge pattern, reclaiming the 50-day moving average with strong volume confirmation. Support now sits around $25, with Fibonacci confluence and wedge targets pointing toward $49-$50.
Liquidity Drives Price Discovery
Edward noted the rally was “not driven by spot buyers” but rather “a structural shift in participation” across derivatives markets. HIP-3 DEXs pushed liquidity boundaries by offering perpetuals on traditional assets alongside crypto, attracting traders seeking exposure beyond major tokens.
The combination of reduced supply, surging derivatives activity, and record DEX volume created conditions for continued upside.
Whether Hyperliquid crypto price can breach the $42 resistance and reach the $50 target depends on maintaining current liquidity levels and the reversal of the broader market selloff that began on January 29.
Source: https://www.thecoinrepublic.com/2026/01/30/hyperliquid-crypto-cuts-february-unlocks-drives-hype-toward-42/
