HYPE OTC Distribution has achieved a significant breakthrough with the completion of the unstaking of 3.75 million HYPE tokens valued at around $330 million by Hyperliquid Labs.
This release marks the biggest ever distribution of team tokens for HYPE, with more than half of the tokens already transferred to five OTC buyers.
The unstaking process concluded on October 7 following a week-long unbonding period that started on September 30. Out of the total 3.75 million HYPE, 1.875 million have been transferred, while another 1.875 million HYPE tokens await transfer.
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What Happened With HYPE?
The HYPE OTC Distribution started with a 7-day unbonding process that took place starting September 30. During the unbonding period, the staked tokens could not be moved.
Once the waiting period was over on October 7, Hyperliquid Labs sent 1.875 million HYPE to five wallets belonging to the buyers in the OTC distribution. Each wallet received the same amount of 375,000 HYPE.
One of the founders of Hyperliquid Labs, iliensinc, stated that the moves were part of the OTC deal with an institutional counterparty. The buyer’s name is not revealed, as are the conditions of the financial deal.
Another 1.875 million HYPE out of the 3.75 million-token pool has not moved yet.
Why Is the HYPE OTC Distribution Important?
What makes HYPE OTC Distribution remarkable is its magnitude compared to the earlier team releases on a month-to-month basis. Earlier team distributions were between 140,000 and 534,000 HYPE.
This most recent distribution of 3.75 million tokens is nearly 8.65 times bigger than the earlier team distributions. This is equivalent to 1.5% of the total supply of HYPE.
Notwithstanding its magnitude, the OTC nature of the transaction ensured that the tokens were not immediately listed on public exchanges, but rather that the initial batch was directly transferred to selected buyers through a private deal.
While the OTC nature of this transaction might reduce the immediate effect on the liquidity of public exchanges, key information is missing, such as the terms of the sale, the price paid for the tokens, and any lock-up periods.
HYPE Team Allocation Falls Below Earlier Figure
HYPE OTC Distribution also forms part of the allocation schedule in the month of October for the team. The previous vesting schedules were showing an October nominal of 9.9 million HYPE.
However, the 3.75 million HYPE that have been unstaked so far are way much below this number. This might be significant for the holders to know that the amount of HYPE that might be staked in the market will be less than what was initially scheduled.
Thus, the remaining 1.875 million HYPE will also form an important allocation in the month of October.
What Happened to HYPE After the Release?
Activity was recorded on the blockchain for those tokens after the transfers, where some were restaked or collected in different wallets.
The HYPE token price was also driven by the positive sentiment of the token distribution, showing that even such a massive amount of coins did not cause a selloff in the open market.
This is a very important feature of the deal. In contrast to the distribution on all exchanges, Hyperliquid Labs transferred half of the tokens to five particular OTC wallets.
David Schamis, the CEO of Hyperliquid Strategies DAT (PURR), claimed on October 8 that his company did not receive a 3.75 million HYPE OTC allocation.
HYPE Market Activity Remains High
HYPE perpetual contract open interest and 24-hour volume data on the current market are $1.76 billion and $575.5 million. At the time of writing, HYPE is trading at $87.30.
Thus, the HYPE OTC Distribution comes at a time when HYPE derivatives continue to see high levels of activity. It could give further insights into how Hyperliquid Labs is managing its October team allocation.
For stakeholders, the disparity between the already mentioned 9.9 million HYPE tokens and the 3.75 million HYPE tokens that have been unstaked until now is a relevant fact. The exact number of HYPE tokens distributed in October depends on further unstaking of tokens.
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