HYPE Token Soars 7% as Biotech Firm Creates $583M Treasury

The Nasdaq-listed biotech firm Sonnet BioTherapeutics is undergoing an $888 million reverse merger with private entity Rorschach I LLC to create Hyperliquid Strategies Inc. (HSI), according to an October 22 filing. This corporate pivot represents one of the most significant institutional moves into the crypto space this year, transforming a traditional biotech company into a major player in the digital asset ecosystem. The merger signals a fundamental shift in how established companies are approaching cryptocurrency investments, moving beyond simple treasury allocations to full-scale corporate restructuring around digital assets.

The newly formed Hyperliquid Strategies Inc. will launch with an unprecedented digital asset treasury, including approximately $583 million in HYPE tokens. This substantial position immediately establishes HSI as one of the largest institutional holders of the Hyperliquid ecosystem’s native token. Additionally, the company has secured a $1 billion facility that may be used for further “potential purchases of HYPE Tokens,” creating what analysts describe as a perpetual demand source for the token. When a digital asset treasury buys a significant chunk of an asset, it is generally considered a bullish development, as institutions typically have longer holding periods compared to retail investors.

While the broader crypto market traded lower, caught in Bitcoin’s choppy price action around $108,000, Hyperliquid’s HYPE token bucked the trend with a nearly 7% gain over 24 hours. This performance stands in stark contrast to competitor BNB Chain’s Aster, which fell 7.6% during the same period, according to CoinGecko data. The divergence highlights how specific catalysts can override broader market momentum, particularly when institutional capital enters the equation.

The discrepancy between the two competing decentralized exchanges stems from “shifting market narratives rather than broad market momentum,” according to Shivam Thakral, CEO of BuyUCoin. He indicated that Aster’s dip results from “profit-taking and waning enthusiasm” following the token’s recent performance. Aster reached an all-time high of $3 on October 6, according to Binance data, and has been in a downtrend since then, losing 67% of its value from the peak. Hyperliquid, while down 21% in the same period, has demonstrated relative resilience amid the market turbulence.

Market sentiment is further reflected in the prediction market Myriad, launched by Decrypt’s parent company DASTAN, where users placed just a 2% chance of Aster hitting $4 in November, down dramatically from 37% a month ago. This sharp decline in market expectations underscores the challenging environment facing many crypto assets despite HYPE’s recent outperformance.

“HSI’s move sends a strong bullish signal for HYPE,” Shivam Thakral told Decrypt, suggesting that the token receives “benefit from added demand, scarcity, and institutional recognition” from the new digital asset treasury’s positioning as a large-scale buyer and strategic holder. The institutional backing provides validation for Hyperliquid’s ecosystem that extends beyond typical retail investor interest, potentially attracting further institutional participation.

However, the filing warned of significant risks, noting that raising capital by offering shares is likely to attract “enhanced regulatory oversight” and high volatility. Perhaps most concerning for existing investors is the substantial shareholder dilution, with Sonnet shareholders being heavily diluted and left with just 1.2% of the new company. This dramatic reduction in ownership stake raises questions about corporate governance and shareholder value protection in such transformative mergers.

The $1 billion facility secured by HSI represents both opportunity and potential volatility for the HYPE token. While additional purchasing power could support price appreciation, concentrated ownership also creates vulnerability to large-scale selling pressure if the strategic direction changes. The market will be watching closely to see how Hyperliquid Strategies Inc. manages its substantial token holdings and whether it becomes a stabilizing force or a source of volatility in the Hyperliquid ecosystem.