JPMorgan Chase & Co (NYSE: JPM) analyst Nikolaos Panigirtzoglou has issued a clear warning that Hyperliquid faces mounting structural pressure. The primary triggers are a significant deterioration in HYPE ETF capital inflows, the expansion of regulated exchanges into perpetual contracts, and intensifying competition in the prediction market.

This dramatic reversal in capital flows forms the foundation of the assessment. During the seven weekly cycles from May 15 to June 26, HYPE ETFs attracted a substantial $293.93 million in inflows, with the week ending June 26 alone recording $111.36 million in net inflows. However, momentum quickly faded thereafter, with subsequent weekly inflows plummeting to $4.32 million and $10.36 million, before turning into net outflows. Over the following three weeks, cumulative outflows reached $30.62 million, with redemption volumes showing a week-over-week increase. Despite a brief correction in capital flow direction in July, the net revenue for these funds remained at approximately $278 million throughout the entire observation period. This data suggests that while investors have not sold off shares purchased during the initial listing on a massive scale, the demand for new capital is no longer as robust as it was in May and June.

The official prospectuses for the Bitwise Hyperliquid ETF (BHYP.US) and 21Shares Hyperliquid ETF (THYP.US) clearly state that these products generate returns by holding HYPE tokens. The establishment of new funds should theoretically increase demand for the token, but sustained redemption pressure may force managers to reduce their holdings. It is worth noting that ETF capital flows are not precise predictors of short-term prices; they more accurately reflect whether regulated investment products are increasing or decreasing demand for the asset beyond Hyperliquid's existing on-chain user base.

Data compiled by Woofun AI indicates that in May, the U.S. Commodity Futures Trading Commission (CFTC) approved the listing of Bitcoin perpetual contracts on regulated U.S. exchanges and established a more comprehensive review framework. At the same time, it classified HYPE futures and similar perpetual contract-type futures into the COIN category. While this regulatory move does not directly prove that the related products already have high liquidity or substantial trading volume, it sends a clear signal that U.S. regulated institutions are preparing to enter the cryptocurrency derivatives competition. For institutional investors who rely on compliance processes, customer identity verification, and legal safeguards, the opportunity to access perpetual contract investments without using decentralized exchanges is highly attractive, posing a direct threat of capital diversion to Hyperliquid.

On the fundamentals and competitive landscape front, Hyperliquid's core strengths stem from its continuous perpetual contract trading services, self-custody features, and the diverse options available on its on-chain exchange. However, with regulated U.S. platforms entering the space, institutional clients may gradually shift to traditional channels. To remain competitive, Hyperliquid must continuously optimize its liquidity, pricing power, and trade execution efficiency, rather than relying solely on product features that regulated platforms cannot offer. Its tokenomic model is closely tied to platform operations: according to the official fee structure, transaction fees are not exclusively collected by the operator but are used to support the community development mechanism, with a portion of revenue also allocated to buying back and burning HYPE. This means that as long as trading volume remains strong and fee income is stable, the negative impact of slowing ETF inflows is relatively manageable. However, if redemptions persist and competitors capture business, the risks will increase significantly.

Furthermore, Hyperliquid's foray into the prediction market aims to reduce its reliance on perpetual contracts, but this means entering a fiercely competitive arena with established brands and ample liquidity. Outcome-based contracts allow users to trade on events such as elections and economic data, and they can be paired with spot or derivative positions. While the technical architecture has incorporated such assets, the relevant developer interface functions are currently only available on the testnet. Only when these contracts can attract users and capital that are not native to Hyperliquid will they truly enhance platform liquidity and fee income. Otherwise, simply adding product categories without substantial capital injection will provide limited support for HYPE's value. At the same time, Hyperliquid's influence in the stablecoin market cannot be ignored. Its development could exert pressure on the operational status of USDC, depending on whether the platform can retain the users, asset balances, and trading activity that give it value.

Looking ahead, the ETF data for the week of August 7 will serve as the next key reference indicator. However, even if there is a short-term recovery in capital inflows, it is unlikely to completely reverse the overarching trend established between May and June. To make a more accurate judgment, it is necessary to synthesize evidence from multiple aspects of the ecosystem: if ETF capital flows stabilize and Hyperliquid can maintain its trading volume in perpetual contracts, then the performance in July may merely represent a normal adjustment phase following the product's listing. Conversely, if redemption behavior persists and platform trading activity declines, it will exacerbate the concerns raised by JPMorgan Chase & Co, as this would not only weaken external demand for HYPE but also directly impact the fee mechanisms tied to platform usage, ultimately affecting the token's ability to capture long-term value.