A trader lost $42M in perp profits in 18 days shorting HYPE. Here’s what’s fueling Hyperliquid’s record-breaking price surge.
It took Loracle nearly 10 months to build $42.2 million in perpetuals trading profits. Then, in just 18 days, a single short position wiped all of it out.
On-chain analytics platform Lookonchain flagged the dramatic reversal, noting the trader ended up down an additional $5.19 million on top of the erased gains. The culprit was a large short on HYPE, the native token of Hyperliquid. The token did not cooperate.
Related reading:
Loracle’s HYPE Short and the Cost of Betting Against the Rally
Loracle, known on-chain as loraclexyz, opened a sizeable short on HYPE through Hyperliquid’s perpetuals market. The position moved against the trader as HYPE climbed aggressively to a new all-time high of $73.73.
Lookonchain compared the situation to previous high-profile blowups involving traders James Wynn and Machi Big Brother.
However, community observers pushed back on that comparison. According to on-chain dashboard data, loracle holds over $107 million in spot assets, mostly in HYPE.
That context suggests the short served as a hedge against spot exposure rather than a pure directional trade. Loracle has since closed most of the position, but still holds a short on 843,232 HYPE tokens, worth roughly $61.4 million in notional value.
loracle.hl(@loraclexyz) has become the next @JamesWynnReal and @machibigbrother!
It took him nearly 10 months to make $42.2M on perps, but his $HYPE short wiped out all his profits in just 18 days and left him down another $5.19M!
He has now closed most of his $HYPE short, but… pic.twitter.com/xmTiNLmty8
— Lookonchain (@lookonchain) June 1, 2026
CoinGecko data shows HYPE trading at $72.32 at the time of writing, up 5.74% in 24 hours and 14.23% over the past seven days. The token recently entered the top 10 crypto assets by market capitalization.
Hyperliquid’s Revenue Engine Is Driving the Price Action
Crypto analyst 0xc06 on X took a closer look at what is actually pushing HYPE higher.
The analyst pointed out that HYPE gained roughly 24% in a week while the broader crypto market dropped about 3% over the same period. That kind of separation from correlated assets, the analyst noted, rarely comes from sentiment alone.
The numbers behind Hyperliquid back that up. The protocol is running close to $1.3 billion in annualized fees. In 2025, its first full year at scale, the platform generated approximately $822 million in actual revenue.
Daily fees regularly clear $1.3 million and push past $1.6 million on busier sessions. Hyperliquid also recorded roughly $2.6 trillion in trading volume across 2025, which is close to double what Coinbase processed in the same period.
Those figures place Hyperliquid above Ethereum, Solana, and Tron individually in fee generation over a comparable window. That is a single application outearning the base layer chains it operates alongside.
$HYPE tagged $73.79.
Fresh all time high, up about 24% on the week. meanwhile the broad market is down roughly 3% over the same stretch.
Let’s break down the revenue engine behind @HyperliquidX
◢ Green While Everything Bleeds
The lazy read is “strong token, strong… pic.twitter.com/KftsBBHEyk— Onur
(@0xc06) June 1, 2026
The Buyback Program Removing 14% of Supply Each Year
The analyst identified the core mechanical driver behind HYPE’s price performance. Hyperliquid routes 97% of all collected fees into what it calls the Assistance Fund. That fund automatically buys HYPE on the open market, every day, without any manual input from the team.
The program has already accumulated over $1.3 billion in cumulative purchases. The fund currently holds around 28.5 million HYPE tokens. By the analyst’s calculations, the buyback removes close to 14% of circulating supply annually.
Measured against market cap, that represents roughly 7% yearly, which the analyst described as four to five times the buyback intensity of assets like ETH or BNB.
The structure functions similarly to a corporate share repurchase program, except it operates on-chain and runs continuously. The analyst noted one key risk: the program depends entirely on trading volume.
A significant drop in user activity would slow fees, reduce buybacks, and reverse the same mechanics now lifting the price. A token unlock scheduled for June 6, covering approximately 9.9 million HYPE, also means new supply is entering a market the buyback fund is actively purchasing into.
The post HYPE Hits New All-Time High as Trader Turns $42M Profits Into Loss appeared first on Live Bitcoin News.
