HYPE has risen sharply in recent weeks, and analyst Alice Liu says the price gains are tied directly to revenue. Liu points to buybacks as the engine behind the token’s recent strength, though she warns that revenue pressure could test that support.
Buybacks Drive the Price
HYPE hit an all-time high of $86 recently. Liu attributes that momentum to buybacks, which happen when a project buys its own tokens on the open market using its revenue.
She cites specific figures:
- Over $400 million USD spent on buybacks
- Leading the pack among token projects in buyback volume
- A small amount of tokens currently unlocked, meaning unlocks will come gradually
Revenue Dependence
Liu argues that HYPE’s price is tethered to revenue flowing into the project. That dependence creates a visible risk.
“So, will we have enough activity on the network to generate the revenue to continue with the buybacks to support the price level? I think that’s one of the key things to watch,” she says.
The AI Token Warning
Liu is far less confident about AI-focused tokens. She singles out the surge in popularity of AI tokens in late 2023, many of which had little or no utility or infrastructure.
Her warning is blunt: “For the previous cycle meme-ified AI tokens that do not have any utility or infrastructure, and are purely just backing onto a concept. I think those could potentially go to zero.”
The Competitor Problem
Liu identifies real competition for these tokens. “They are facing such big competition at the moment with the actual AI stocks, all the memory stocks, and all the AI companies. So I think that might be the competitor they’re facing,” she says.
Solid Infrastructure Survives
Not all AI tokens are doomed in her view. Liu points to “some really solid” AI infrastructure projects with real use cases.
“I think they will have utilities too. But even then, I think they’re likely to get a price discount,” she says.
Crypto as a Safe Haven
Liu sees Bitcoin and the broader crypto market as an overlooked place to hold funds in the current economic environment. But she differs from others in the space.
Coinbase CEO Brian Armstrong and ARK Invest CEO Cathie Wood have both predicted Bitcoin will reach $1 million by 2030. Liu takes a more cautious position.
“Bitcoin to $500K by 2030,” she laughs. “It’s not unlikely that we might hit one million, but I’ll give it a more conservative answer.”
The Buyback Risk
Liu’s reading of HYPE is bullish on the token’s near-term path but worried about the longer structural picture. The buybacks have driven the price, but the revenue needed to keep buying back tokens depends on sustained network activity.
The Takeaway
Liu’s reading of HYPE is bullish on the token’s near-term path but worried about the longer structural picture. The buybacks have driven the price, but the revenue needed to keep buying back tokens depends on sustained network activity.
Her warning on AI tokens without real use cases is sharper. Those tokens, she says, face a wall of competing AI stocks and memory stocks and could fall to zero.
For investors, the lesson is to distinguish between projects with real infrastructure and those built on ideas alone. The former may lag, but the latter could collapse entirely.