Hyperliquid (HYPE) has been one of the most talked-about cryptocurrencies recently, and for good reason. Since its significant gains from April, it has attracted considerable attention from both retail and institutional traders, particularly after it overtook Deribit in the Bitcoin perpetual swaps (BTC perps) market. With a notable growth rate of 170% in just a short time, many are wondering if this trend could continue and if Hyperliquid’s native token, HYPE, could eventually reach $40 or even higher.

Hyperliquid’s Meteoric Rise

BTC perpetual swaps are some of the most popular derivative instruments in the crypto space, especially among retail investors. These contracts allow traders to speculate on the future price of Bitcoin, and their popularity has been driven by the simplicity of their funding rates. Major centralized exchanges (CEXs) like Binance, Bybit, and Deribit have traditionally dominated this market. However, Hyperliquid, a decentralized exchange (DEX) built on its own blockchain, has begun to eat into the market share of these CEXs.

Hyperliquid’s growth is largely attributed to its user-centric approach. The platform appeals to users who value anonymity and decentralized trading, while also providing a user-friendly interface, deep liquidity, and advanced technical features. It has consolidated a fragmented user base, with traders flocking to the platform due to its seamless trading experience. Hyperliquid has created a cult-like following through its airdrops, which have incentivized new users and turned them into loyal holders.

Flipping Deribit and Targeting OKX

According to data from Bloomberg, Hyperliquid has already surpassed Deribit in terms of open interest (OI) in Bitcoin perpetual contracts. OI refers to the total amount of money invested in a particular contract, and Hyperliquid’s OI topped $1.8 billion, surpassing Deribit’s $1.14 billion. The platform is now eyeing OKX as the next target, with its OI at $2.56 billion. If Hyperliquid’s growth trajectory continues, it could soon surpass OKX and further solidify its dominance in the BTC perps market.

This impressive expansion doesn’t stop with Bitcoin. Hyperliquid’s total open interest across all tokens, including Ethereum (ETH) and Solana (SOL), reached an all-time high of $5.6 billion. Since its introduction, the DEX has processed over $1 trillion in trading volume, underscoring its rapid adoption and increasing significance in the decentralized finance (DeFi) sector.

HYPE Token: A Key Player in the Growth

Hyperliquid’s native token, HYPE, is crucial to the ecosystem’s growth. The token not only serves as a utility token for transactions on the platform, but it also provides fee discounts to holders. HYPE has benefited from the platform’s growth, increasing by 170% from its lows in April. This uptick in value has been largely driven by the surging demand for decentralized derivatives trading and the growing user base of the platform.

The token’s growth is also influenced by its ongoing deflationary program. Hyperliquid has implemented a buyback mechanism that reduces the supply of HYPE tokens, thereby increasing demand and, in turn, boosting its price. These factors collectively drive HYPE’s value appreciation.

Bullish Pattern for HYPE’s Price Action

On the daily price chart, HYPE is showing signs of forming a bullish inverted head and shoulders pattern. This is a technical formation that typically signals a trend reversal and is considered a strong bullish indicator. If this pattern is validated, HYPE could see a rally to new highs, with analysts eyeing a potential target of $45.

However, there are several key resistance levels that HYPE needs to clear before it can achieve this bullish ascent. The first resistance level lies at $27, followed by $35. Once these levels are breached, HYPE will have the momentum needed to push toward the $40 mark, and potentially higher.

Support Levels to Watch

On the downside, HYPE’s price action has shown that the 50-day Exponential Moving Average (EMA) at $19.60 could serve as a strong support level in case of a sharp pullback. If HYPE experiences a decline, this level could act as a safety net, preventing further losses and providing a potential entry point for buyers looking to capitalize on the dip.

The Future of Hyperliquid and HYPE

Hyperliquid’s recent performance has been nothing short of impressive, and the platform’s dominance in the BTC perps market is likely to continue growing. With the rapid rise of decentralized finance, Hyperliquid is well-positioned to expand further, taking market share from centralized platforms while also benefiting from its loyal community and user base.

If the bullish pattern on HYPE’s price chart plays out as expected, it could reach new highs, with $40 being a realistic short-term target. However, traders should keep an eye on resistance levels, market conditions, and overall sentiment in the crypto space to gauge whether the rally will continue.

As Hyperliquid continues to grow and disrupt the centralized exchange market, HYPE token holders may find themselves in a profitable position as the project gains more recognition and adoption.