Key Highlights
- The Hyper Foundation has permanently burned 37.5 million HYPE tokens, worth about $912 million, following a governance vote.
- The tokens are held at a system address with no private key, making them mathematically irretrievable from the blockchain.
- This burn lowers the total HYPE supply from 1 billion tokens and reduces the fully diluted valuation (FDV) of the token.
The Hyper Foundation has officially recognized 37.5 million HYPE tokens as permanently burned, following a stake-weighted governance vote in which 85% of participants supported the move.
The tokens, valued at roughly $912 million, are held at a system address, 0xfefefefefefefefefefefefefefefefefefefefe, which has no private key, making them mathematically irretrievable.
These tokens were accumulated in the Assistance Fund, which converts a portion of spot trading fees from Hyperliquid’s layer-1 perpetual futures blockchain into HYPE. Moving them to a burn-like address effectively removes them from the circulating supply without requiring any fork.
The burn drew positive reactions from the community. One user posted on X, “Strong community signal on supply reduction. This kind of decisive governance outcome is what keeps tokenomics credible long-term.”
While supporters see it as a boost to HYPE’s deflationary model, some raised concerns about added pressure on the remaining HLP safety fund and potential centralization in the voting process.
The decision came after a proposal released on December 17, 2025, which asked network validators to remove the Assistance Fund HYPE from both circulation and total supply. Although the tokens were already inaccessible, the vote created a binding social consensus that ensured no future protocol upgrade could unlock them.
Token holders were able to delegate their stake to validators who shared their view, and validators had until December 24 to cast their votes.
The burn reduces the total HYPE supply from 1 billion tokens and lowers the fully diluted valuation (FDV), tightening circulating availability.
HYPE price and ETF developments
According to CoinMarketCap, at the time of writing, HYPE was trading around $23.85, with a market capitalization of approximately $8 billion and an FDV near $23 billion. Trading volumes have fallen slightly in the past 24 hours amid broader market fluctuations.
The U.S. Securities and Exchange Commission has received applications from asset managers Bitwise and 21Shares to introduce ETFs linked to HYPE, indicating growing interest from traditional finance.
Bitwise intends to create an ETF that would directly hold HYPE tokens, while 21Shares is requesting approval for a 2x leveraged ETF that would provide investors with twice daily exposure to the token. Through regulated products, these filings seek to expose investors to HYPE without requiring them to own the tokens.
Also Read: Hyperliquid Refutes Claims on $362M Shortfall and Insider Trading
