Arthur Hayes, the renowned Chief Investment Officer at Maelstrom and co-founder of Bitmex, has sparked controversy in the cryptocurrency community by selling 96,600 Hyperliquid (HYPE) tokens for approximately $5.1 million. This move comes less than three weeks after he made a bullish prediction about the asset, leaving many to wonder about his stance on the protocol.
Initially, Hayes attributed the sale to financing the purchase of a Ferrari, but Maelstrom later clarified that the decision was driven by risk management considerations rather than luxury expenses. This clarification has done little to alleviate concerns about Hayes’ position on Hyperliquid, with many in the community questioning his commitment to the protocol.
Understanding the Sale of Hyperliquid Tokens
In a statement on X (formerly Twitter) on September 22nd, Maelstrom highlighted the structural challenges facing HYPE, particularly in light of its upcoming token unlock plan. The company noted that Hyperliquid is set to face a “Damocles sword” moment on November 29th, with 237.8 million tokens set to be unlocked linearly over 24 months. At an average price of $50, this translates to a potential unlock value of $11.9 billion or approximately $500 million in tokens per month.
Maelstrom calculated that Hyperliquid’s buyback mechanism can only absorb around 17% of this unlock, leaving tokens worth approximately $410 million exposed to open market sales every month. Furthermore, the company expressed doubts about the demand from institutional investors for digital assets like HYPE, suggesting that their purchases would be “only a drop in the bucket compared to the impending HYPE unlock.”
Increasing Competition in the DeFi Space
Beyond the token economy, Maelstrom argued that Hyperliquid is now facing increased competition from stronger players in the decentralized exchange (DEX) arena. The recent launch of Aster, a new platform backed by Binance founder Changpeng Zhao, has introduced several unique features such as hidden orders and support for multiple multichain. As a result, Aster has emerged as a darling of the crypto industry, with its DEX volume surpassing that of Hyperliquid in the last 24 hours.
Maelstrom noted that “you don’t eat the lunch of the crypto establishment and go unchallenged. The business is war, and the half-life of most crypto products has been short in the past.” Despite this, Hayes has not entirely abandoned his bullish stance on HYPE, claiming that the token could still achieve a 128-fold profit by 2028.
For more information on this development and its implications for the cryptocurrency market, please visit https://cryptoslate.com/arthur-hayes-sells-5-1-million-hype-tokens-because-of-11-9-billion-hyperliquid-concerns/
