Analysis: HYPE Breaks $50 for the First Time in Eight Months, Triggered by Short Squeeze and ETF Inflows

On May 21, Santiment took to social media to share that a large number of traders have been betting on HYPE’s price drop over the past few days, pushing funding rates across multiple trading platforms deeply into negative territory. However, HYPE’s price has continued climbing, triggering a classic short squeeze: bearish traders were forced to cover their positions (closing out their bets), which further drove up the asset’s price. Currently, HYPE futures open interest stays at an extremely high level of over $19.2 billion. While the market had anticipated a potential liquidation cascade, HYPE’s status as one of crypto’s hottest assets has drawn in new traders, keeping open interest elevated. The main catalyst for this recent surge? Market enthusiasm around Hyperliquid-related ETFs. Back in May 2026, firms like Bitwise and 21Shares launched ETFs pegged to HYPE, giving traditional investors access to the asset without needing a crypto wallet or decentralized exchange. Analysts note these ETF launches signal Hyperliquid’s shift from a niche DeFi platform to an institutionally recognized part of the crypto ecosystem.