21Shares Advances into Decentralized Finance with New ETF Proposal
21Shares is making significant strides in the decentralized finance (DeFi) sector by filing a proposal for an exchange-traded fund (ETF) linked to the Hyperliquid blockchain and its associated token, HYPE.
Key Highlights
21Shares has submitted a Form S-1 with the U.S. Securities and Exchange Commission (SEC) to initiate the Hyperliquid ETF, which aims to provide investors with exposure to the HYPE token. Currently, HYPE ranks as the 16th largest cryptocurrency and serves as the backbone of Hyperliquid, a Layer 1 blockchain designed specifically for DeFi applications. This proposal follows a series of crypto ETF launches from firms such as Grayscale and Bitwise. The metrics within the DeFi landscape are also reflecting renewed vitality, highlighted by a notable increase of over 10 percent in Hyperliquid’s total value locked (TVL) within a week.
Details of the Filing
On October 29, 2025, 21Shares officially filed a Form S-1 with the SEC, proposing the establishment of the 21Shares Hyperliquid ETF. If the SEC grants approval, this ETF would provide a regulated means for investors to access Hyperliquid’s ecosystem and its native token, HYPE. The filing identifies Coinbase Custody Trust Company and BitGO Trust Company as custodians for the fund. This news emerges at a time when institutional interest in the crypto market is on the rise, along with a flurry of new ETF proposals.
21Shares Expands Amid Rising Crypto ETF Interest
As one of the leading managers of exchange-traded products, 21Shares is strategically positioning itself to be a significant player in the evolving landscape of crypto finance. The proposal for the Hyperliquid ETF follows a similar application by Bitwise earlier in the year and contributes to a surge of activity in October, during which firms like REX Shares and Osprey Funds submitted over twenty ETF-related applications. The filing also coincides with the recent acquisition of 21Shares by prime broker FalconX, which is anticipated to merge FalconX’s trading capabilities with 21Shares’ expertise in exchange-traded products, potentially expanding the range of derivative and structured crypto offerings available. Recent regulatory changes have expedited the ETF application process, with the SEC allowing firms to initiate ETF launches 20 days post-filing if no amendments are requested. Furthermore, approvals of listing standards by three exchanges prior to a government shutdown have simplified the process for crypto-focused funds.
Hyperliquid’s Strength in DeFi Boosts Appeal
Hyperliquid is well-regarded for its robust trading infrastructure, particularly in the derivatives market, and is currently offering impressive returns. Data from RR2 Capital indicates that the protocol’s liquidity provider vault has an annual percentage rate (APR) of 160 percent, outperforming many other decentralized exchanges in the perpetual trading space. Meanwhile, the overall metrics for decentralized finance are showing positive signs, with thirteen different blockchain networks boasting total value locked (TVL) exceeding one billion dollars. Hyperliquid’s TVL has surged by 10.9 percent within a single week, marking it as the highest growth among major platforms and reflecting increased confidence in DeFi protocols.
Price Momentum Aligns With Market Optimism
The HYPE token has experienced a sharp rebound from its lows in October, which hovered around $33, driven by both technical indicators and fundamental developments. Analysts have observed a classic cup-and-handle chart pattern, often interpreted as a bullish sign. With $45 being a significant support level and $49 representing a breakout point, projections now suggest targets approaching $60 if the buying momentum persists. The ETF proposal from 21Shares reinforces the overall market sentiment, bridging institutional interest with the growing enthusiasm observed in retail investors. Additionally, Robinhood’s recent inclusion of Hyperliquid on its trading platform has further enhanced its visibility and liquidity in the U.S. markets.
Insightful Takeaway
In the realm of digital assets, a timely ETF filing can significantly enhance investor confidence. What is particularly noteworthy about 21Shares’ initiative is that it is launching a new fund during a broader institutional movement toward DeFi. With Hyperliquid demonstrating strong fundamentals, a substantial increase in total value locked, and impressive yield rates, it is no wonder that HYPE is capturing interest from both retail and institutional investors alike. The interplay of technical price movements and real-world usage data makes this ETF proposal particularly intriguing. It has the potential to serve as a crucial link, facilitating the entry of traditional capital into the decentralized finance sector.
