HYPE Price Prediction After the New Hyperliquid Burn Proposal

HYPE price token stayed on edge today, Dec. 17, as traders reacted to a new proposal. The plan would remove about 11% of the token’s supply from circulation.
Hyperliquid token dropped to $27.36, its lowest level since May this year. It has tumbled by 55% from its all-time high.

HYPE Price Technical Analysis as it Sends Mixed Signals

The daily chart shows that the HYPE token has been in a sharp downtrend over the past few months. It has fallen from a September high of $60 to its current level of $27.

That drop has seen the token erase billions of dollars in value as its market capitalization has dropped to $9.8 billion.

On the negative side, the token has dropped below the 61.8% Fibonacci Retracement level at $28.2. This is important since assets tend to rebound whenever they move to this retracement level.

The token remains below the dynamic resistance of the  50-day and 100-day Exponential Moving Averages (EMA), a sign that bears remain in control.

HYPE price has also moved below the Supertrend indicator. At the same time, the top oscillators like the RSI and the MACD have continued moving downwards.

These technicals indicate that the HYPE price may keep sliding in the near term. Sellers appear to be aiming for the next key support level at $20.

However, the token has formed a falling wedge pattern, which often leads to a strong rebound. This pattern consists of two descending, converging trendlines.

A rebound typically occurs whenever the price approaches its point of confluence. In this case, a rebound may see it jump to the 38.2% Fibonacci Retracement level at $40.

Hyperliquid Makes a Token Burn Proposal

One potential catalyst for the HYPE token is that the developers have made a major proposal. This proposal may remove about 11% of it from circulation.

The Hyper Foundation said in a statement that it is proposing a validator vote to formally recognize the Assistance Fund HYPE as burned. This move would officially remove those tokens from circulation.

If passed, this means that the network will remove these tokens permanently from circulation and the total supply.

This is an important vote as the implication is that at least 11% of HYPE tokens will be removed from circulation. Chances are that the community will vote in favor of the burn since it will improve its tokenomics.

However, the implication may be limited as the tokens are already in an address without an access key. The only way to access these tokens is with a hard fork. The result of the validator vote will be known on December 24.

This token burn will help to offset the millions of new HYPE tokens that are released through its token unlocks.

Cantor Fitzgerald is Bullish on HYPE Token

Meanwhile, Cantor Fitzgerald, the giant Wall Street company, initiated its coverage of the HYPE with a bullish view.

The analysts believe that its fundamentals are strong as the company continues to gain market share from centralized exchanges.

They believe that the company will have a 17% market share in the perpetual futures industry. It’s a move that will see its annual fees jump to $5 billion in the next decade. As such, by applying a 25x multiple, the analysts believe that the token will be worth $125 billion.

The fees will cause the number of tokens in circulation to drop sharply. The company plans to use its network fees to repurchase its own tokens.

Additionally, the analysts believe that the other parts of the network will do well, including its layer-1 networks. This will help to boost its performance.

HYPE token is sending mixed signals on what to expect in the near term. Some technicals suggest that it has more downside.

However, the falling wedge pattern points to more gains in the coming weeks. Odds are that bulls will prevail, especially after the bullish outlook by Cantor Fitzgerald.