Helium (HNT) Price

Hyperliquid’s HIP-5 Proposal Sparks Community Debate Amidst DePIN and DeFi Market Rebound

## Executive Summary The Hyperliquid community is engaged in a debate over the HIP-5 proposal, which aims to reallocate protocol fees, even as the Decentralized Physical Infrastructure Networks (**DePIN**) and Decentralized Finance (**DeFi**) sectors experience a market rebound. This contrasts with a continued pullback in the Artificial Intelligence (**AI**) token sector. ## The Event in Detail The Hyperliquid community is deliberating the **HIP-5 proposal**, which suggests allocating up to 5% of protocol fees to an assistance fund designed to buy back tokens from ecosystem projects. Proponents argue this initiative would incentivize builders and enhance HYPE governance by providing additional resources to emerging projects. Conversely, critics express concerns regarding potential misuse of funds and the risk of centralization, suggesting it could lead to an uneven distribution of resources and power, potentially undermining the platform's decentralized nature. This proposal is viewed as potentially diluting the buyback-driven price support for the **HYPE** token, as 99% of fees currently contribute to **HYPE** buybacks. The prior **HIP-3** upgrade, known as RedStone, notably enabled permissionless perpetual markets, which has spurred developer activity within the Hyperliquid ecosystem. In the broader cryptocurrency market, **DePIN** and **DeFi** sectors demonstrated a significant recovery. **DePIN** climbed 6.7% and **DeFi** rose 6.1% on the day. Key contributors to the **DePIN** index's positive performance included **HNT**, which gained 11.1%, and **Render** (**RNDR**), up 8.7%. Together, these two tokens accounted for approximately a quarter of the index's growth. Conversely, the **AI** token sector experienced a further decline, shedding 8.6% over seven days and reducing its market capitalization by approximately $2.4 billion. While some **AI**-related tokens like Virtuals Protocol and ChainOpera AI dropped over 10%, **Bittensor** (**TAO**) and Internet Computer (**ICP**) managed to buck this trend, gaining 14.1% and 21.9% respectively. Notably, **Bittensor** subnets were among the top performers, with **Pundi AI** (**PUNDI**) increasing by 108%, Sportstensor (**SN41**) by 65.4%, **AI** Rig Complex (**ARC**) by 55.3%, Alpha Trader Exchange (**SN63**) by 31.9%, and Bitcast (**SN93**) by 25.1%. One **Bittensor** subnet, acquired by Tiger Royalties, reportedly generated nearly $70,000 in monthly revenue. ## Market Implications The **HIP-5** debate on Hyperliquid highlights ongoing challenges in balancing ecosystem growth incentives with decentralization principles. The potential diversion of protocol fees could influence the valuation dynamics of **HYPE** and other ecosystem tokens. Should the proposal pass, it may set a precedent for resource allocation models within decentralized autonomous organizations (**DAOs**). Separately, the strong performance of **DePIN** and **DeFi** sectors suggests resilience and sustained investor interest in these foundational crypto narratives. The growth within the **Bittensor** ecosystem, particularly its subnets, underscores the increasing viability of decentralized **AI** and data infrastructure projects, attracting notable revenue streams like the $20 million combined annual recurring revenue from Targon, Lium, and Chutes. Looking ahead, the upcoming **Bittensor** halving, projected for December 10-13, 2025, will reduce daily **TAO** emissions from 7,200 to 3,600 tokens. This supply cut is anticipated to create significant scarcity, potentially driving price appreciation. Crypto analyst Quinten projects **TAO** could reach $1,000 by late 2025 and $2,000 in early 2026, assuming increased demand and the impact of reduced supply. This event represents the first halving in **Bittensor**'s history, which typically has a profound effect on token distribution dynamics. ## Broader Context The ongoing market dynamics reflect a complex and evolving landscape within the crypto industry. The debate surrounding **HIP-5** on Hyperliquid exemplifies the governance challenges inherent in decentralized platforms, where balancing community input with strategic development is critical. The robust performance of **DePIN** and **DeFi** sectors signals a maturing segment of the market, indicating continued innovation and utility. Meanwhile, the mixed performance within the **AI** token sector, where **Bittensor** subnets thrive despite broader pullbacks, indicates that project-specific fundamentals and novel approaches to decentralization are increasingly important drivers of value in this rapidly expanding domain.