Bitwise’s Hyperliquid ETF, trading under the ticker BHYP, has crossed the 1 million HYPE token threshold. That puts the fund’s total holdings north of $62 million, barely two weeks after it started trading on NYSE Arca.

Roughly $55 million of those tokens are actively staked, generating yield from Hyperliquid’s protocol revenue.

A staking ETF that actually stakes its own tokens

BHYP launched on May 15 with a sponsor fee of 0.34%, though Bitwise is waiving that fee for the first $500 million in assets. The fund provides 100% spot exposure to HYPE tokens, meaning investors own the real thing rather than some derivative or futures-based approximation.

What separates BHYP from its competitors is the plumbing. Bitwise built its staking infrastructure in-house through Bitwise Onchain Solutions, rather than farming it out to third-party providers. When BHYP stakes its HYPE tokens, the entire process stays within Bitwise’s operational perimeter, which reduces the kind of counterparty risk that comes from handing your assets to someone else to manage.

By running its own validators, Bitwise maintains direct control over slashing risk, where a validator misbehaves and a portion of staked tokens gets destroyed as a penalty. The staking rewards generated flow back to investors, net of fees.

The fund’s purchasing pace has been aggressive. On-chain data shows single-day acquisitions worth tens of millions of dollars in HYPE tokens.

Hyperliquid’s unusual economics

Hyperliquid operates as a proof-of-stake Layer 1 blockchain built specifically for on-chain perpetual contracts.

The staking model is where things get interesting. Most proof-of-stake networks pay staking rewards through inflation, essentially printing new tokens and handing them to validators. Hyperliquid takes a different approach: staking rewards come from actual protocol revenue. The fees traders pay to use the platform get redistributed to stakers.

The competitive landscape is heating up fast

Bitwise isn’t alone in this race. 21Shares has its own Hyperliquid product trading under the ticker THYP, and Grayscale is working on a competing fund called HYPG.

Collectively, US Hyperliquid ETFs pulled in more than $117 million in inflows within roughly 10 trading days of their respective launches.

Bitwise is currently the sole sponsor running proprietary staking infrastructure, giving BHYP a differentiator that competitors cannot replicate quickly. The 0.34% fee, waived until the fund hits $500 million, is clearly designed to accelerate asset gathering during this early phase.

For investors considering BHYP, the appeal is straightforward: exposure to a fast-growing derivatives protocol plus staking income, all wrapped in a regulated ETF structure that doesn’t require managing wallets, private keys, or validator nodes.