21Shares Hyperliquid Staking ETF

21Shares Hyperliquid Staking ETF

Overview

• Structure: Delaware statutory trust issuing exchange-traded shares (ticker: THYP) listed on The Nasdaq Stock Market.
• Investment objective: Track the performance of HYPE (via a Pricing Benchmark) adjusted for the Trust’s expenses and liabilities, and reflect staking rewards from a portion of the Trust’s HYPE when the Sponsor determines staking is appropriate without jeopardizing grantor-trust tax status.
• Primary asset: HYPE, held by HYPE Custodians (Anchorage Digital Bank N.A. and BitGo Bank & Trust, N.A.).
• Governance and service providers: Sponsor — 21Shares Group; Trustee — CSC Delaware Trust Company; Administrator / Transfer Agent / Cash Custodian — BNY Mellon; HYPE Custodians — Anchorage and BitGo; Staking Services Provider — Figment Inc.
• Regulation and structure: The Trust is not registered as an investment company under the 1940 Act and is not a commodity pool. Reporting and governance follow the Trust documents.

Key facts and figures

• Listing: Shares listed on Nasdaq under THYP since May 12, 2026.
• Shareholder record: Approximately one DTC participating shareholder of record (as of June 30, 2026).
• Fiscal year-end: June 30.
• Initial seed capital: Sponsor purchased 2 Seed Shares on March 18, 2026 at $50 per share ($100 total); Seed Shares redeemed for cash on March 23, 2026.
• Funding for distributions: Quarterly cash distributions intended to come from staking rewards; the Trust plans to sell an equivalent amount of HYPE at quarter-end to fund distributions.
• Asset mix: Primarily HYPE and cash.
• HYPE supply and circulation: Fixed supply of 1 billion HYPE (as of June 30, 2026); ~222 million HYPE released into circulation by Sept 1, 2026.
• Market context (as of Sept 15, 2026): HYPE market cap ~ $19.68 billion; 24-hour trading volume ~ $143.5 million.
• Sponsor scale: 21Shares Group oversees approximately $4.63 billion in assets and 73 digital asset-related ETFs/products (as of June 30, 2026).

Investments and operations

• Primary investment: The Trust holds HYPE and uses a Pricing Benchmark (calculated by a Benchmark Provider) to value NAV and Shares.
• NAV and valuation: NAV calculated daily on Business Days at 4:00 p.m. ET using the Pricing Benchmark. Principal Market NAV is determined for financial-statement purposes using fair value in the principal market.
• Creation and redemption: Creates and redeems Creation Baskets (10,000 Shares per basket or multiples) with Authorized Participants; settlements may be in cash or in-kind via transfers of HYPE.
• Staking exposure: A portion of the Trust’s HYPE may be staked to earn rewards via Figment Inc.; staking rewards reduce the pool of HYPE held by the Trust and are distributed (after fees) to Shareholders.
• Staking mechanics:
  • Target Utilization Rate: Intended staking generally between 60% and 100% of HYPE, subject to liquidity needs.
  • Roles: Figment operates validator nodes; HYPE Custodians hold and enable staking; rewards are accrued and redelegated daily.
  • Reward allocation: 30% of staking rewards are retained as Staking Provider Consideration (split among the Sponsor, the Staking Services Provider, and the HYPE Custodians); the remainder is distributed to Shareholders as cash distributions at least quarterly.
  • Agreement terms: The Staking Services Agreement includes a Global Cap, Slashing Cap, and Missed Rewards Cap, with carve-outs for gross negligence, fraud, or willful misconduct.
  • Liquidity considerations: Unstaking and withdrawal timing can affect liquidity; unstaking to fulfill redemptions occurs after approval and processing on the Hyperliquid Network, and some rewards may accrue before unlock.
• Custody and safekeeping: HYPE Custodians hold the Trust’s HYPE, with a substantial portion in cold storage and insured under policies shared among custodian customers; coverage levels and availability may vary.
• Administration and banking: BNY Mellon serves as Administrator, Transfer Agent, and Cash Custodian; BNY Mellon Asset Servicing handles administration and accounting under the Cash Custody Agreement.

Fees and economics

• Sponsor fee: Unitary Sponsor Fee of 0.30% of the Trust’s NAV, accrued daily and payable in HYPE at least quarterly. The Sponsor covers most ordinary operating expenses from this fee, except for litigation and certain extraordinary expenses.
• Sponsor-paid expenses: Ordinary course legal fees and expenses are capped at $100,000 per year. Other Sponsor-paid expenses include marketing, Administrator fees, HYPE Custodian fees, Transfer Agent and Trustee fees, listing-related expenses, regulatory fees, and other routine costs.
• Staking-reward economics: The 30% staking-reward split among the Sponsor, Staking Services Provider, and HYPE Custodians is separate from other Sponsor-paid expenses and reduces the net staking rewards available to the Trust.
• Distribution mechanics: Staking rewards accrue in HYPE and are intended to be liquidated as needed to fund quarterly cash distributions.

Taxation and regulatory

• Tax classification: The Sponsor and Trustee treat the Trust as a grantor trust for U.S. federal income tax purposes. Safe-harbor guidance for staking under a grantor-trust framework exists as of November 10, 2025.
• Alternate tax outcomes: If the Trust were not treated as a grantor trust, it could be treated as a partnership or corporation for tax purposes, which would change reporting and distribution treatment.
• Securities and regulatory risk: The Trust is not registered under the 1940 Act. Market structure and pricing depend on evolving regulatory developments around digital assets, including whether HYPE is deemed a security.
• AML and sanctions controls: The Trust relies on KYT and due diligence by HYPE Custodians and Authorized Participants, with screening procedures in place.

Creation/redemption and market mechanics

• Authorized Participants: Registered broker-dealers that have agreements with the Sponsor and Administrator; may conduct in-kind or cash creations/redemptions. In-kind transactions are preferred for efficiency but may not always be available.
• Arbitrage and pricing: The creation/redemption process supports arbitrage that aligns Share price with HYPE, though cash creations and operational factors can affect mechanism effectiveness.
• Liquidity risks: Delays or issues in creating/redeeming baskets, hedging challenges by counterparties, or disruptions in the Hyperliquid Network can lead to premiums/discounts to NAV or reduced liquidity.

Risks and considerations

• Market risk: HYPE is volatile with a limited trading history and has experienced large price swings in observed periods.
• Network and governance risk: Hyperliquid Network is proof-of-stake and decentralized, with potential centralization concerns, governance uncertainty, and risks from forks, airdrops, and protocol changes.
• Operational risk: Reliance on multiple service providers introduces single points of failure; custody arrangements carry limited liability protections; cybersecurity and fraud risks exist.
• Regulatory risk: Ongoing changes in digital asset regulation, and potential classification of HYPE as a security, could affect compliance requirements, liquidity, and trading venues.
• Liquidity risk: Concentration in a single asset (HYPE) and a bespoke custody and settlement framework can make trading liquidity sensitive to Authorized Participant availability and market conditions.
• Taxable events: Staking rewards and fork-related events can create taxable income; U.S. tax guidance for digital assets is developing.

Summary

The 21Shares Hyperliquid Staking ETF is a Delaware statutory trust that holds HYPE and seeks to track HYPE’s performance via a Pricing Benchmark while providing shareholders with staking-derived cash distributions. The Trust uses established custodial, administrative, and staking service providers, applies a defined staking model and fee structure, and operates within an evolving regulatory and tax environment.