Hyperliquid News Today: DeFi Faces Liquidity Challenges: $3 Million Exploit Reveals Underlying Vulnerabilities
- Hyperliquid paused deposits/withdrawals after a suspected POPCAT memecoin price manipulation attack caused $4.95M in losses for its community liquidity pool. - A trader used 19 wallets with $3M in USDC to create $25.5M in leveraged long positions, triggering rapid liquidations when prices collapsed. - This follows a March incident involving JELLYJELLY memecoin, highlighting systemic risks in DeFi platforms managing leveraged trades and low-liquidity assets. - The attack exposed vulnerabilities in onchain
Hyperliquid, a prominent decentralized exchange for perpetual contracts, paused both deposits and withdrawals on Wednesday after a suspected case of price manipulation involving the
Data from blockchain analytics provider
An onchain observer known as MLMabc pointed out that the trader seemed to deliberately disrupt the exchange by placing $20 million in buy orders at $0.21 per POPCAT token around 14:45 CET. The total long exposure climbed to $30 million before the price drop set off a chain reaction of liquidations. Hyperliquid’s bridge was taken offline for more than 20 minutes shortly after, likely as a measure to stabilize the platform and prevent additional losses, as per
This isn’t the first time Hyperliquid has encountered manipulation. Back in March, a comparable attack involving the Solana-based memecoin JELLYJELLY led to $12 million in unrealized losses for the HLP. Experts note that such incidents highlight the difficulties decentralized exchanges face in handling extreme market volatility, especially with leveraged trades and concentrated positions, according to
This latest event has also sparked debate about the broader dangers present in decentralized finance (DeFi). Although Hyperliquid’s team stresses the importance of community-driven risk controls and onchain openness, the situation demonstrates how challenging it is to manage large leveraged trades in fast-moving price environments. At the time of writing, POPCAT had dropped over 30% from its earlier highs this week, and Hyperliquid’s own token, HYPE, was down almost 2%.
Hyperliquid has not provided a timeline for when deposits and withdrawals will be restored, leaving both users and liquidity providers uncertain. This incident is a stark illustration of the vulnerabilities in leveraged trading systems, where swift price changes and coordinated maneuvers can rapidly escalate systemic threats.
Disclaimer: The content of this article solely reflects the author's opinion and does not represent the platform in any capacity. This article is not intended to serve as a reference for making investment decisions.
You may also like
Trailblazers Forge Mina’s Mesa Route: Joint Testing Transforms Blockchain Advancements
- Mina Protocol's "Mesa" upgrade introduces faster block slots, expanded on-chain limits, and automated hard forks to enhance performance and developer capabilities. - The five-phase testing plan includes internal validation, testnet experiments, and incentivized community trials to ensure seamless mainnet deployment. - Automated upgrades and expanded zkApp support aim to reduce operational complexity while maintaining network security and accessibility for node operators. - Collaborative testing through T
Ethereum News Today: "Ethereum Giants Face Off: $37 Million Long Position Battles $9.9 Million Short in High-Risk Hyperliquid Wager"
- Ethereum whales opened $37M long and $9.9M short positions with 25x leverage on Hyperliquid, highlighting crypto's high-stakes trading dynamics. - Hyperliquid's deep liquidity and transparent execution attract large players using stablecoins to fund leveraged positions amid volatile markets. - Technical analysis shows Ethereum facing resistance at key levels, while macroeconomic factors like US-China tensions drive risk-averse trading behavior. - Experts warn high-leverage positions risk rapid liquidatio
Hyperliquid News Today: DeFi 'Degen Warfare' Erupts: POPCAT Exploit Results in $4.9M Loss for Hyperliquid
- Hyperliquid suffered a $4.9M loss from a POPCAT token manipulation attack orchestrated by a single trader exploiting thin liquidity and automated risk systems. - The attacker used 19 wallets to inflate POPCAT's price before liquidity removal triggered cascading liquidations, forcing Hyperliquid's HLP to absorb remaining losses. - POPCAT's price dropped 19% in 24 hours to $0.1262, exposing vulnerabilities in DeFi platforms' ability to prevent market manipulation in low-liquidity memecoin markets. - This f
Bitcoin News Today: Bitcoin Faces a Crucial Test: Balancing Macro Challenges and Institutional Investments as $100K Level Comes Under Pressure
- Bitcoin dips below $100,000 amid macroeconomic pressures and institutional selling, though ETF inflows and tokenization trends hint at stabilizing demand. - Fed rate uncertainty, government shutdown risks, and falling SOFR amplify market anxiety, while hedge funds boost crypto exposure to 55%. - Technical indicators flag $92,000 as a potential support zone, with cold storage inflows and historical patterns suggesting long-term holders remain active. - Market trajectory hinges on Fed policy shifts or prol
Trending news
MoreCrypto prices
More
