Hyperliquid to Vote on Burning 37M HYPE Tokens

Hyperliquid's governance community is poised to vote on a proposal that would formally recognize millions of HYPE tokens held in the protocol's Assistance Fund as permanently burned, a move aimed at clarifying the token's supply dynamics amid ongoing unlocks and market pressures.

The Hyper Foundation announced the proposal on December 17, seeking validator consensus to treat the Assistance Fund's HYPE holdings as inaccessible and excluded from both circulating and total supply calculations. The fund, which automatically converts a portion of trading fees from Hyperliquid's perpetuals exchange into HYPE tokens, currently holds about 37 million tokens, valued at roughly $1 billion. These tokens reside in a system address without a private key, rendering them irretrievable without a protocol hard fork. Validators began signaling their positions on December 21, with final stake-weighted voting results expected on December 24. Community indications suggest strong support, with most validators planning to approve the measure, which requires no on-chain changes but establishes a binding social consensus against future access.

This governance action comes as Hyperliquid faces persistent...