Asset manager 21Shares has filed with the U.S. Securities and Exchange Commission (SEC) for a 2x leveraged Exchange-Traded Fund (ETF) tied to Hyperliquid (HYPE). The proposed fund aims to offer investors double the daily returns of the Decentralized Finance (DeFi) protocol. Despite this move signaling growing institutional interest, the HYPE token is facing significant downward pressure and testing a critical support level.

A New Approach to DeFi Exposure

The filing, submitted on October 16, 2025, outlines the “21Shares 2x Long HYPE ETF.” If approved, it would become the first U.S.-listed leveraged ETF designed to track the performance of a live DeFi protocol. The fund intends to provide this exposure without holding the underlying HYPE tokens directly.

Instead, it will utilize financial derivatives like swap agreements and options to replicate twice the token’s daily performance. This innovative structure allows investors to gain exposure to the DeFi ecosystem’s growth without managing the complexities of direct token custody. The proposal from 21Shares reflects a broader trend of institutional interest, with other major asset managers like Bitwise also submitting filings for spot HYPE ETFs.

HYPE Token Falters Despite ETF Buzz

The positive news has failed to spark a rally for the HYPE token. Trading around $34, the token has declined nearly 10% over the last 24 hours and is now testing a key support zone between $34 and $35. This downturn is part of a wider correction from recent highs, mirroring weakness across the broader crypto market.

Although a recent protocol upgrade briefly pushed the price to $43.24, the bullish momentum was short-lived. The 30-day simple moving average (SMA) currently sits around $45.27, well above the current price and confirming a persistent bearish trend.

Technical indicators suggest that selling pressure may be increasing. The Moving Average Convergence Divergence (MACD) indicator is showing a bearish crossover, with its main line falling below the signal line. If HYPE fails to hold the $34 support level, a further decline toward $30 is possible. On the other hand, a sustained recovery above $37.50 would be required to signal a potential trend reversal.

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