Hyperliquid Traders Increase Exposure As Semiconductor Stocks Slide
The broader selloff followed the Democrats’ sweeping victories in the US midterm elections, which raised concerns about potential restrictions on data-center expansion and the future pace of AI infrastructure investment.
On November 5, the Nasdaq Composite dropped 5.5%, while the S&P 500 declined 4.4%. Semiconductor companies experienced particularly heavy selling pressure. Nvidia lost more than 9%, while AMD suffered a 17.3% decline. Qualcomm also dropped following disappointing guidance for smartphone chip sales.
Despite these losses, Dune’s analysis found that outstanding contracts across US semiconductor and memory perpetual markets increased 60%. Meanwhile, the underlying stocks declined between 12% and 28%.
The contrast suggests that traders viewed the correction as an opportunity to accumulate exposure rather than simply exit the sector. However, the shift was selective. Open contracts in major technology companies, including Microsoft, Amazon, Meta and Alphabet, declined 27% over the same period.
Rising Funding Rates Reveal Strong Demand For Long Positions
Funding rates provide additional evidence of this positioning shift. On Hyperliquid, perpetual contracts use periodic payments between long and short traders to help keep contract prices aligned with their underlying reference prices.
Dune recorded funding levels approximately five times above their usual baseline in the affected chip markets. Positive funding means long traders pay short traders, reflecting a premium in perpetual contract pricing.
This mechanism also creates an important cost for leveraged buyers. Funding payments occur hourly, meaning traders can accumulate substantial expenses even when prices remain unchanged. A prolonged decline can further increase liquidation risks by reducing available margin.