Hyperliquid validators to decide the fate of HYPE tokens on ‘Keyless’ address

According to the Foundation’s explanation, this mechanism is strictly embedded in the Layer 1 execution. Trading fees are converted to HYPE and automatically routed to a dedicated address. This address was initially created without a control key, meaning the funds cannot be withdrawn. The Foundation notes that returning the tokens would require a hardfork. As of the time of publication, the address has accumulated approximately $1 billion worth of HYPE.

If validators vote “yes,” they will agree to consider this balance “burned” in an economic sense, meaning it is permanently inaccessible. The tokens, however, will physically remain on the address. This change is purely for metrics: the proposal suggests excluding the Assistance Fund from both circulating supply and total supply, ensuring that the calculation only includes the number of tokens that could theoretically enter circulation.

The initiative received support from Native Markets, the company issuing the USDH stablecoin in the Hyperliquid ecosystem. Native Markets reminded the community that 50% of USDH reserve yield is also directed to the Assistance Fund and converted into HYPE. If the vote passes, such inflows will immediately be treated as “locked” tokens.

The Hyper Foundation emphasizes that the initiative is driven by a focus on transparency, rather than an attempt to create artificial scarcity to boost the price. Hyperliquid actively promotes a model where a significant portion of fees goes toward automatic HYPE buybacks. This model has drawn interest from traders and public “treasury” companies that hold the token on their balance sheets. According to DefiLlama data, the platform has processed over $205 billion in perpetual contract volume over the last 30 days.

In parallel, the team continues to expand its product offerings. Last autumn, Hyperliquid launched Based Streams: a live broadcast format with an overlay of on-chain trades and donations via Hypercore. In November, the project activated the HIP-3 Growth Mode, a setting that reduces taker fees for new markets by over 90% and allows deployers to enable ultra-low fees for their own perp markets under the near-permissionless HIP-3 model.

The Growth Mode is based on the HIP-3 upgrade, which launched on the mainnet on October 13th. It allows for the creation of new perp markets without team approval, provided the deployer stakes 500,000 HYPE. These markets operate alongside “validator-approved” pairs, and validators retain risk control tools, including open interest limits. In Growth Mode, the combined fee for new markets drops from 0.045% to a range of 0.0045%–0.009%, and can potentially go as low as 0.00144%–0.00288%, making it extremely attractive for large investors.