The Fourth Most Held Asset After Bitcoin and Ethereum: JPMorgan Issues Critical Warning for That Altcoin
JPMorgan announced that interest in Hyperliquid (HYPE) ETFs has come to a standstill in July and early August following the peak in May and June.
Banking giant JPMorgan has published a critical report on Hyperliquid, one of the most notable projects in the cryptocurrency world this year. Bank analysts stated that the growth momentum in the ETF wing of the Hyperliquid ecosystem, a decentralized futures platform, has been hampered by increasing competition and regulatory pressures. The platform, which took the lead among non-Bitcoin funds in May and June, seems to have lost this momentum as of July.
Achieving great success at the institutional level, Hyperliquid rose to become the fourth most held asset in institutional treasuries, following Bitcoin, Ethereum, and Solana (SOL). However, despite this institutional success, cash inflows on the ETF side slowed down as of July. JPMorgan warns that the launch of regulated crypto perpetual futures products in the US could draw investors away from offshore and decentralized platforms like Hyperliquid.
Regulated Exchanges and Prediction Market Competition
Analysts emphasize that centralized exchanges could gain an advantage, particularly in areas such as licensing, compliance, and investor protection. Furthermore, intensifying competition in the prediction markets space, which Hyperliquid entered as part of its diversification strategy, makes it difficult for the platform to maintain its market share. Currently, while Bitcoin ETFs have a size of $77 billion and Ethereum ETFs $10 billion, other crypto funds, including Hyperliquid, share a total volume of only between $2 and $3 billion.
In the shadow of these developments, the HYPE price has lost more than 3 percent in value over the last 24 hours, retreating to the $55.30 levels. JPMorgan states that the decreasing probability of regulations like the Clarity Act being enacted is also putting pressure on the overall crypto outlook. To what extent Hyperliquid can maintain its market share against giant competitors and which way regulated rivals will shift fund flows remains one of the biggest question marks in the industry.