In a very small, and at least so far obscure, corner of the crypto market, investors are rushing in rather than towards the exits. So-called HYPE exchange-traded funds are attracting new assets from investors at a time when major crypto bets including bitcoin And ethertank.
In May, Bitwise and 21shares launched spot ETF tracking indices for HYPE, a decentralized crypto asset that runs on its own, hyperliquid blockchain. Products that trade under the tickers BHYP And THYPhave raised nearly $150 million in assets and, since launch, have generally experienced positive net inflow days, which attracted attention by Nate Geraci, president of NovaDius Wealth Management.
Grayscale launched its own Grayscale Hyperliquid Staking ETF (HYPG) Wednesday.
“This is a market that has penetrated 1% of its addressable market. Most people still don’t know what hyperliquid is,” Bitwise Chief Investment Officer Matt Hougan told CNBC.
Hyperliquid is a decentralized system perpetual futures contracts exchange built on the blockchain. It works 24 hours a day for merchants outside the United States. It existed quietly until last summer, when the war between the United States and Iran sent traders rushing to access oil markets on weekends. Volume quickly reached about $1 billion a day in crude oil alone, said Stephen Coltman, vice president and head of macro at 21shares.
For a token that most financial advisors and investors had never heard of a month ago, the reception has been hard to ignore, especially at a time when bitcoin is experiencing a steep decline. Spot Bitcoin ETFs have bled assets. The iShares Bitcoin Trust ETF (it will be fine), for example ended the week down around 16%.
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HYPE flows are less likely to be a rotation out of existing crypto than a movement by investors into something genuinely new.
“Hyperliquid is attracting new investors from outside the crypto ecosystem to this particular digital asset. I think it speaks to a much different type of investor than bitcoin,” said Zach Pandl, head of research at Grayscale.
Pandl said investors are attracted to a revenue model they can understand. Most crypto tokens have an indirect relationship with the underlying business of the platform, but hyperliquid is different.
“In the case of hyperliquid, 99% of the fees generated on the platform go towards redeeming HYPE, the asset,” Hougan said. “There is a very tight loop between the activity that is happening in the cryptocurrency space and the value of the hyperliquid asset,” Hougan said.
It’s a market mechanism that traditional stock investors would immediately recognize: the practice of public companies using their cash to repurchase their own shares. “It’s very similar to a stock buyback, where all transactions are generated and used to buy back the token,” Coltman said.
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Performance of hyperliquid ETFs since their launch in May 2026.
ETF experts say these funds provide a convenient entry point for investors who want exposure without the complexity of creating a digital wallet or navigating a decentralized exchange.
As of Friday, the just-launched Grayscale Hyperliquid Staking ETF had $4.5 million in assets. The 21shares Hyperliquid ETF has $75.8 million in assets under management, while the Bitwise Hyperliquid ETF has $71.14 million.
Geraci said that as investors become more familiar with hyperliquidity through ETFs, it is reasonable to expect that the products could help accelerate widespread adoption of the platform itself.
“I see crypto spot ETFs as an important bridge between TradFi [traditional finance] and DeFi [decentralized finance]. While it is difficult to determine the degree of overlap between HYPE ETF investors and hyperliquid users, ETFs undoubtedly increase awareness of the platform,” he wrote in an email to CNBC.
But ETF experts have warned that awareness is still low, competition is widespread and risks remain high.
21shares highlights its benchmark history, having listed a HYPE product in Europe, as of August 2025. Grayscale has the lowest expense ratio, at 0.29%, compared to 21shares at 0.30% and Bitwise at 0.34%. Bitwise has strong relationships with family offices.
“Hyperliquid’s biggest challenge could be growing competition from TradFi and DeFi, a dynamic that a more favorable regulatory environment could intensify,” Geraci wrote.
The platform remains unavailable in the United States, but Pandl said he expects approval to be 2027, which he called a “reasonable timeline for when we can have clear enough regulation around decentralized exchanges that U.S. users can start accessing the platform.”
The landscape could then be considerably more populated. The history of rapid asset growth in hyperliquid ETFs shows that some investors aren’t waiting.
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