Hyperliquid (HYPE) price drops 15% amid centralisation issues

Hyperliquid (CRYPTO:HYPE) has experienced a significant price decline, dropping 5% in the last 24 hours and nearly 15% over the past week. 

This downturn has pushed its market capitalisation below $7 billion, placing it at the 25th position among cryptocurrencies. 

The decline is attributed to growing concerns regarding the platform's transparency and centralisation practices. 

Recent analysis indicates that Hyperliquid controls approximately 81% of staked HYPE tokens, raising alarms about its decentralisation claims. 

Kam Benbrik, a node operator, noted that such concentration poses risks to network stability, stating that if a single entity holds a third of the stake, they could halt operations.

The Average Directional Index (ADX) for HYPE has surged to 27.5, indicating a strengthening downtrend in market activity. 

This increase suggests that bearish control is intensifying, with selling pressure rising sharply as buying interest wanes.

Despite these challenges, some technical indicators show signs of potential stabilisation. 

The BBTrend indicator has recently turned positive, suggesting that selling pressure may be easing if buying momentum improves.

However, for HYPE to reverse its current trajectory, investor confidence must be restored amid ongoing scrutiny.

The current support level at $21.59 is crucial; if it fails to hold, analysts predict further declines could lead to a drop towards $12, representing a potential 40% correction from current levels.

Conversely, if HYPE can regain momentum and break above resistance at $22, it may set the stage for a recovery towards previous highs near $30.

Market observers are closely monitoring these developments as they unfold in an increasingly competitive cryptocurrency landscape.

At the time of reporting, the Hyperliquid (HYPE) price was $21.23.