Bitwise operates the Bitwise Hyperliquid ETF (BHYP), which began trading on NYSE Arca in mid-May.

The strategy could provide price support from ETF demand but also carries risks if Hyperliquid volumes fall or large investors withdraw, highlighting market and protocol risks.

Bitwise has sharply increased its Hyperliquid exposure by depositing and staking 1.775 million HYPE tokens, worth about $114 million at the time of the move.

This positions Bitwise as part of a broader buildup, following earlier purchases including a single 77,097 HYPE buy around $5.18 million.

The staking move marks a major addition to Bitwise’s position, aligning stake with on-chain activity and potential yield.

Bitwise’s stake signals conviction and underscores ongoing competition to secure Hyperliquid exposure among institutions.

Even relatively small regulated-fund allocations can drive significant on-chain flows for HYPE due to its market size and demand dynamics.

BHYP follows the launch of the ETF and offers exposure to HYPE without direct custody or staking, aiming to capture on-chain yield.

Staking reduces HYPE’s circulating supply and ties returns to Hyperliquid’s activity and revenue, making the investment dependent on price and platform use.

BHYP is designed to generate rewards by holding and staking HYPE, linking fund growth to on-chain incentives rather than a passive ETF model.

Hyperliquid is attracting institutional interest, with Bitwise’s sizable stake signaling rising demand for regulated, ETF-linked exposure to crypto derivatives.

Staking on Hyperliquid is funded by protocol revenue through trader fees distributed to stakers, rather than through traditional token issuance.