After Bitcoin Crash, Can the hype for HYPE ETFs Continue?

Bitcoin has tumbled about 15% last week (as of June 5, 2026) and slumped about 25% over the past month and slipped below the $60,000 mark, extending a downturn that is raising fresh questions about its ability to protect investors from inflation.Bitcoin's recent weakness is extremely eye-catching because it has plunged during a broader rally in risk assets. In line with Bitcoin, Ethereum has seen its prices slump 21.2% last week (as of June 5, 2026) and fall about 33% over the past month.Bitcoin and Ethereum continue to trade more like high-risk assets than inflation hedges. These assets are highly volatile in nature. When uncertainty rises, as in the current scenario of the Iran war and Fed rate-hike concerns, investors often reduce exposure to volatile assets. Also, profit-booking in Bitcoin has led to the slump in the cryptocurrency.Overall, iShares Bitcoin Trust ETF IBIT has lost about $2.77 billion in assets over the past one month, per data provided by ETF Central. iShares Ethereum Trust ETF ETHA lost about $566 million in assets.Euphoria Shift to HYPE from Bitcoin Apart from the above-mentioned reasons, HYPE, or hyperliquid, ETFs attracted nearly $160 million in inflows within days of launch, even as Bitcoin and Ether ETFs cratered, as quoted on CNBC.In May, Bitwise and 21shares launched spot ETFs tracking indexes for HYPE, a decentralized crypto asset that operates on its own blockchain, hyperliquid, per CNBC.Hyperliquid (HYPE) is a high-performance, Layer-1 blockchain specifically built for decentralized perpetual futures, spot trading, and on-chain finance. It processes orders with sub-second latency to match centralized exchange speeds while maintaining full decentralization.Since its launch in 2023, Hyperliquid has become the leading decentralized exchange for perpetual futures, a more than $60 trillion market that is reshaping global derivatives investing, per CryptoQuant, as mentioned by Bitwise.Virtually all of Hyperliquid's trading revenue (99%) is used to buy back HYPE tokens, linking HYPE's value to the platform's growth and adoption.HYPE ETFs in Focus Bitwise Hyperliquid ETF BHYP, which hit the market on May 14, 2026,provides cost-efficient exposure to the price movement and potential staking rewards of HYPE, the native asset of the Hyperliquid network.The gross expense ratio of the BHYP ETF is 0.34%. ETF experts say that investors are attracted to this new crypto space for its buyback model, which uses platform trading fees to repurchase HYPE tokens and creates a direct link between activity and value. The gross staking reward rate is 2.25%.Bitwise believes Hyperliquid’s large market share, high annual revenue, and strong token buyback program have offered the HYPE token an intriguing early-stage technology investment.21Shares Hyperliquid ETF THYP looks to track the performance of HYPE, as measured by the performance of the FTSE Hyperliquid Index. The fund charges 30 bps in fees.Can the Winning Momentum Continue?Due to rising rate worries, as the broader market crashed, HYPE ETFs lost about 12% each on June 5, 2026. However, staking rewards are a source of passive income even if prices crash.Your HYPE tokens generate rewards while you hold them. Current staking yields have generally been around 2–3% annually. Rewards are added over time, resulting in automatic compounding.Note that staking helps secure the Hyperliquid blockchain and keeps it running smoothly. Suppose you own 1,000 HYPE and the staking reward is 2.5% per year. After one year, you could have about 1,025 HYPE.Bottom Line The euphoria surrounding new product launches and the benefits of passive income generation (even if prices fall) can lead to asset growth in HYPE ETFs over time. Agreed, occasional rising-rate concerns are negative, but the scope for above-average returns is always greater, as is the case with every high-risk asset. Boost Your Portfolio with Our Top ETF InsightsZacks' exclusive Fund Newsletter delivers actionable information, top news and analysis, as well as top-performing ETFs, straight to your inbox every week.Don’t miss out on this valuable resource. It’s free!Get it now >>This article originally published on Zacks Investment Research (zacks.com).Zacks Investment ResearchWeiter zum vollständigen Artikel bei Zacks Weiter zum vollständigen Artikel bei Zacks