HyperLiquid, a leading decentralized perpetual trading platform based on open interest, was attacked this morning, resulting in a $5 million loss to the platform’s HLP vault.
A user or entity has established a $20 million long position in POPCAT meme coin. Once the position had grown to approximately $30 million, the attackers allowed a liquidation, losing $3 million in the process and leaving HLP with over $25 million worth of POPCAT. This attack was similar to the JELLYJELLY exploit that occurred in March.
The subsequent decline resulted in a loss of $4.9 million for HLP, and its return was -1% over the past month.
HLP Monthly Profit and Loss – Hyper Liquid
In response, HyperLiquid suspended deposits and withdrawals to HLP and manually closed positions. Shortly after, Arbitrum Bridge’s auto-lock feature activated, preventing deposits and withdrawals from Hyperliquid itself.
Hyperliquid developer Iliensinc addressed the issue on the Hyperliquid Discord, saying, “The automatic locking of the Arbitrum bridge was caused by a conservative set of conditions, and after the situation was thoroughly investigated within 25 minutes, the bridge was unlocked. The funds are safe. The Hyperliquid blockchain itself was not affected and no downtime occurred.”
During and after the attack, HYPE briefly fell below $38, but has recovered to $38.8 at the time of writing.
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