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Hyperliquid loses $4M after whale’s ETH trade liquidation

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5 hours ago

March 12, 2025

Samuel Ikperu

Hyperliquid lost $4M after a whale's $200M ETH trade was liquidated. The whale's 50x leverage led to HLP vaults losses, despite no protocol breach.

A whale’s massive $200 million Ether trade was liquidated, causing Hyperliquid to lose $4 million.

Hyperliquid lost $4 million when a massive Ether (ETH) long position, valued at over $200 million, was liquidated.

Wallet ‘0xf3f4’ leveraged 50x on an ETH long position, using $4.3 million USDC as margin for a total exposure of 113,000 ETH. The platform later liquidated the position.

By withdrawing funds and reducing the margin below the maintenance level, the user gained $1.8 million, while Hyperliquid’s HLP vault suffered a $4 million loss.

Vaults on Hyperliquid function as blockchain-driven products where users stake USDC and potentially earn a portion of the profits from the trading strategies of the vault’s owner or other users.

Users on Hyperliquid suspected an exploit, but the platform quickly responded on X to dispel the speculation.

“There was no protocol exploit or hack,” Hyperliquid said. “This user had unrealized PNL, withdrew, which lowered their margin, and was liquidated. They ended with ~$1.8M in PNL. HLP lost ~$4M over the past 24h. HLP’s all-time PNL remains at ~$60M. As a reminder, HLP is not a risk-free strategy.”

To mitigate the risk of similar strategies, Hyperliquid announced that it will revise the maximum leverage for Bitcoin (BTC) and Ether (ETH) to 40x and 25x, respectively. The platform also decided to raise maintenance margin requirements for substantial positions.

Read also: NFT trading volume drops 635 since december

This wasn’t the first attack on Hyperliquid. In June 2023, an attacker exploited HLP by using SNX price movements on CEXs and secured $37K USDC.

To strengthen its defenses, HLP promptly refined its pricing strategies.

Despite the setback, Hyperliquid’s HLP vault has maintained an overall profit of $60 million, according to available data.

Hyperliquid’s HYPE token briefly dropped below $13 from $14 in response to the liquidation but has now regained its previous value as of late Asian trading.

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