Viewpoint: Hype Selling Pressure Easing, Bullish Market Sentiment for Future Prospects

BlockBeats News, January 27th, Cryptocurrency analyst Ericonomic posted an analysis explaining the recent significant price drop of HYPE. He stated that the drop from the $45-50 range to around $20 was not random, but was caused by three very specific sources of selling pressure, which are either resolved at present or close to exhaustion.

Most trackers still show approximately 9.9 million HYPE tokens being released monthly, leading many users to believe there would be around $200 million in selling pressure every month. This assumption is incorrect. Unlocking does not mean distribution, distribution is not equivalent to sale, and sale does not necessarily mean selling on the open market. On-chain data shows that only 7-10% of initially unlocked HYPE tokens have been used for market selling, with the rest flowing to OTC trades and staking.

As HYPE entered the fourth quarter of 2025, the derivative structure was not healthy, with long positions dominating. Along with the continuous liquidation, most of the aggressive long positions have disappeared, and currently, there are still over $150 million in long positions with liquidation prices below $15. However, the downward price pressure brought by leverage has largely dissipated.

A cluster of 16 addresses initially involved in HYPE funding through Tornado Cash accumulated around 4.4 million HYPE tokens at an average price of about $8.8 per token, equivalent to a $80 million supply. Starting in early January, this entity adopted a highly mechanized liquidation strategy: unlocking approximately one wallet per day, intending to push the HYPE price below $10 if fully sold, which has not actually happened at that time. When the Tornado cluster aggressively sold on-chain, market maker Wintermute immediately began arbitrage. Wintermute sold the received HYPE selling pressure to multiple off-chain buyers. In the past 30 days, Wintermute facilitated arbitrage trades exceeding $70 million in HYPE, with on-chain data showing buyers including Resolv Labs, Auros Global, and others.

Ericonomic's analysis has sparked widespread discussion in the crypto community, boosting market confidence in HYPE's future prospects. According to market data, HYPE broke through $25.7, with a 24-hour increase of 16.2%.