HYPE Crushes Bitcoin and Ethereum With 48% Gains in Q1 2026 – What’s Driving It?

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• HYPE gained 48% in Q1 2026, outperforming BTC and ETH by a wide margin.
  
• Growth in HIP-3 non-crypto trading is driving platform adoption and revenue.
  
• Buybacks and rising user activity are supporting continued bullish momentum.

Hyperliquid’s native token, HYPE, has emerged as one of the standout performers in the first quarter of 2026, significantly outpacing both Bitcoin (BTC) and Ethereum (ETH). While the broader crypto market struggled amid macro uncertainty and the West Asia crisis, HYPE delivered a remarkable 48% quarterly gain. In contrast, Bitcoin fell by 25% and Ethereum dropped by 32%, positioning HYPE as a rare bright spot for investors.

The sharp divergence highlights a shifting dynamic in crypto markets, where niche platforms with strong utility and revenue models are beginning to attract attention.

HYPE’s Outperformance Tied to Growing Platform Activity

According to Hyperliquid Strategies CEO David Schamis, the token’s strong performance may not be a one-off event. He pointed to rising adoption and increasing visibility as key drivers, suggesting that momentum could extend into Q2.

A major factor behind this growth is the surge in trading activity on Hyperliquid, particularly during weekends when traditional markets are closed. Increased coverage from major financial outlets has also drawn new participants to the platform, expanding its user base beyond crypto-native traders.

HIP-3 Market Expansion Drives Demand

At the core of Hyperliquid’s growth is the rapid expansion of its HIP-3 segment, which allows users to trade non-crypto assets. This feature gained traction during the West Asia crisis, as traders sought alternative venues to access markets like oil and gold outside standard trading hours.

By late March, HIP-3 daily open interest surpassed $2 billion for the first time, marking a significant milestone. Even more notable is user retention, with around 60% of non-crypto traders continuing to use the platform—an indicator of sustained engagement rather than short-term speculation.

Currently, HIP-3 accounts for roughly 38% to 48% of total activity on Hyperliquid, making it a major contributor to overall trading volume and revenue.

Revenue Growth and Buybacks Fuel Price Rally

Hyperliquid’s revenue model has also played a critical role in HYPE’s price appreciation. A significant portion of platform earnings is used for token buybacks, creating consistent upward pressure on price.

The platform recorded strong revenue growth in early 2026, with monthly revenue hitting nearly $69 million in January and weekly figures climbing from $8 million to as high as $14 million by March. These revenue spikes coincided with aggressive buyback activity, which aligned closely with HYPE’s price rallies.

In January alone, the token surged 86%, followed by another 72% rally between February and March, pushing prices to new highs.

Also Read: Hyperliquid and $9B DOJ Bitcoin: Crypto’s Next Big Crisis?

Despite a recent pullback, market observers suggest that HYPE could present a buying opportunity if current trends hold. Continued expansion of the HIP-3 segment, combined with improving overall market sentiment, may provide the foundation for further gains.

However, risks remain tied to broader crypto volatility and macroeconomic developments. For now, HYPE stands out as a compelling example of how innovation and strong fundamentals can drive performance—even in challenging market conditions.

Disclaimer: The information in this article is for general purposes only and does not constitute financial advice. The author’s views are personal and may not reflect the views of Chain Affairs. Before making any investment decisions, you should always conduct your own research. Chain Affairs is not responsible for any financial losses.