The crypto market shows signs of mixed sentiment today, with U.S. spot Bitcoin ETFs recently flipping to positive net inflows after a streak of outflows, while the Hyperliquid (HYPE) token surges on exciting protocol news.

Bitcoin ETFs Flip Positive

U.S. spot Bitcoin ETFs kicked off February strongly, recording approximately $562 million in net inflows on February 2, snapping a prior multi-day outflow streak with some reports citing four days and over $1.5 billion in prior outflows. This marked one of the largest single-day inflows in recent weeks, led by major funds like: BlackRock’s IBIT ~$142 million inflow. Fidelity’s FBTC ~$153 million and Bitwise’s BITB ~$96.5 million.

The inflows contributed to Bitcoin’s rebound, pushing its price back toward ~$78,000 after testing lower levels around $75,000 in recent dips. However, the momentum appears tactical—flows reversed to net outflows of ~$272 million on February 3 (Tuesday), with Fidelity seeing significant redemptions.

Overall year-to-date inflows remain strong cumulative ~$55-56 billion since launch, but 2026 has started choppier compared to the blockbuster 2024-2025 periods, amid broader market volatility and shifting institutional focus.

This “flip positive” moment signals renewed bargain-hunting and institutional support during the pullback, though sustained inflows will be key for further BTC stability. HYPE Soars on HIP-4 AnnouncementHyperliquid’s native token HYPE jumped roughly 10% with some reports up to 14% in the 24 hours following the February 2 announcement of HIP-4.

The upgrade introduces “outcome trading” to HyperCore (Hyperliquid’s L1 engine), enabling fully collateralized, non-leveraged contracts that settle within fixed ranges—ideal for prediction markets and bounded options-like instruments. Key features of HIP-4: No leverage or liquidations (lower risk profile).

Dated, non-linear derivatives expanding beyond perpetual futures. Permissionless outcome-based trading (testnet stage, with mainnet rollout expected). Settles in USDH (Hyperliquid’s stablecoin).

This positions Hyperliquid to compete directly in the booming prediction markets niche like  event outcomes, binary bets while adding expressivity to its DEX. Amid a broader market downturn with many alts bleeding, HYPE’s rally stands out as a bright spot, reflecting strong community/trader excitement over the expansion.

HIP-4 is a Hyperliquid Improvement Proposal that introduces outcome trading (also called “outcome contracts” or “outcomes”) as a new primitive on HyperCore, Hyperliquid’s high-performance Layer-1 trading engine.

This upgrade expands Hyperliquid beyond its core strength in perpetual futures by adding support for non-leveraged, event-based derivatives. It’s currently live on testnet with canonical markets in USDH, with mainnet rollout and potential permissionless features expected based on feedback.

What is Outcome Trading?

Outcome trading involves fully collateralized contracts that settle to a predetermined value often binary: 0 or 1, or within a bounded/fixed price range based on an objective outcome at expiration. Fully collateralized — Traders post the entire potential loss upfront as collateral. No borrowing or margin calls.

No leverage — Unlike perps, there’s no amplified exposure. No liquidations — Positions can’t be force-closed due to adverse price moves; risk is capped at the initial collateral. Dated/expiry-based — Contracts have fixed expiration dates (introducing time decay and event horizons, unlike perpetuals).

Non-linear payoffs — Payouts can be binary or stepped within a range, enabling asymmetric risk-reward profiles. Settlement — Based on objective reference prices/sources. Contracts settle within a predefined fixed range or to discrete outcomes. Denominated in USDH — Hyperliquid’s native stablecoin, keeping fees and value within the ecosystem supporting HYPE buybacks, etc.

Traders bet on binary or multi-outcome real-world events with capped risk. Examples: “Will Bitcoin exceed $150,000 by December 31, 2026?” (Yes/No shares settle to 1 or 0). Election results, sports outcomes, economic data releases, or crypto milestones. This competes with platforms like Polymarket but leverages Hyperliquid’s speed, low fees, and deep liquidity.

Structured products with limited downside and non-linear upside, similar to binary options, range options, or barrier derivatives—but without leverage risks. Traders get exposure to specific price ranges or events with predefined max loss/gain.

Why It Matters for Hyperliquid

Adds diversity beyond perpetuals ? turns the platform into a broader on-chain “financial layer.” Appeals to users wanting lower-risk event bets especially in volatile markets. Composable with existing features (portfolio margin, HyperEVM for dApps, permissionless markets via HIP-3 style).

Drives fees, liquidity, and HYPE utility in a growing niche (prediction markets projected at tens of billions in TAM). Event bets, probability plays, capped-risk derivatives. In short, HIP-4 brings safer, more expressive derivatives to Hyperliquid, unlocking prediction markets and bounded options natively on a fast, on-chain DEX.

This has already driven strong HYPE price action amid broader market weakness, reflecting excitement over the ecosystem’s expansion. Keep watching testnet progress for real-world examples soon.

Overall, Bitcoin’s ETF rebound offers a glimmer of recovery support, while Hyperliquid’s HIP-4 news highlights how DeFi innovation can drive outsized gains even in risk-off environments. Keep an eye on sustained ETF flows and BTC price action above $78K for clues on broader sentiment.