Jelly – Earlybirds Invest https://earlybirdsinvest.com Latest Crypto News Sun, 30 Mar 2025 06:13:01 +0000 en-US hourly 1 https://wordpress.org/?v=6.9.7 https://i0.wp.com/earlybirdsinvest.com/wp-content/uploads/2024/12/cropped-New-Project-2024-12-17T235703.455.png?fit=32%2C32&ssl=1 Jelly – Earlybirds Invest https://earlybirdsinvest.com 32 32 240146708 JELLY Scheme Backfires, Hyperliquid Trader May Lose $1 Million https://earlybirdsinvest.com/jelly-scheme-backfires-hyperliquid-trader-may-lose-1-million/ https://earlybirdsinvest.com/jelly-scheme-backfires-hyperliquid-trader-may-lose-1-million/#respond Sun, 30 Mar 2025 06:13:01 +0000 https://earlybirdsinvest.com/jelly-scheme-backfires-hyperliquid-trader-may-lose-1-million/

A trader linked to unusual activity on the Hyperliquid exchange might have lost nearly $1 million, according to blockchain firm Arkham Intelligence.

The situation involves Jelly my Jelly (JELLY), a meme coin that was frozen and removed from the platform following the incident.

In a March 26 post on X, Arkham reported that the trader tried to take advantage of the system by opening three separate accounts within minutes. Two of them placed large buy positions worth $2.15 million and $1.9 million, while the third opened a $4.1 million sell position.

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JELLY’s price suddenly increased by over 400%, which triggered liquidation of the large short position. However, the system could not handle it immediately due to its size. The position was passed to the Hyperliquidity Provider Vault (HLP), which is responsible for managing large liquidations.

At the same time, the trader withdrew collateral from the other two accounts. Arkham noted that the trader had a “7-figure positive PnL to withdraw from” at that moment.

However, Hyperliquid later restricted the accounts to reduce-only mode. This means the trader could no longer open new positions and had to sell off holdings in one of the accounts to try to recover some of the funds.

Arkham says the trader has withdrawn around $6.26 million in total. However, at least $1 million remains stuck in the accounts.

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CEO Gracy Chen raised concerns about how Hyperliquid handled this situation. What did she say? Read the full story.

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]]> https://earlybirdsinvest.com/jelly-scheme-backfires-hyperliquid-trader-may-lose-1-million/feed/ 0 27997 Hyperliquid Announces Key Risk Management Updates Following JELLY Market Incident https://earlybirdsinvest.com/hyperliquid-announces-key-risk-management-updates-following-jelly-market-incident/ https://earlybirdsinvest.com/hyperliquid-announces-key-risk-management-updates-following-jelly-market-incident/#respond Sat, 29 Mar 2025 08:20:30 +0000 https://earlybirdsinvest.com/hyperliquid-announces-key-risk-management-updates-following-jelly-market-incident/

HyperLiquid has announced a series of risk management improvements following a major incident involving its Hyperliquidity Provider (HLP) vault.

As part of its response, HyperLiquid’s Foundation will refund users who held JELLY long positions at the time of settlement, using a closing price of $0.037555. This move is expected to ensure that all JELLY traders, except those with flagged addresses, receive a settlement price that is beneficial to them.

The decision follows the delisting of JELLY perpetual contracts after validators identified suspicious market activity.

What Happened?

The incident stemmed from a trader allegedly manipulating the price of JELLY, leading to significant unrealized losses for HLP, a market-making vault within HyperLiquid.

The trader, who held $4.85 million worth of JELLY, combined a short position on HyperLiquid with on-chain spot buys, which triggered a liquidation event that transferred the short position to HLP. As the trader aggressively purchased JELLY on decentralized exchanges, its price surged, which temporarily caused HLP’s unrealized losses to reach $13.5 million.

With liquidity on decentralized exchanges being relatively low, the price movement was more pronounced. In response, HyperLiquid force-closed the JELLY market and settled it at $0.0095, which is much lower than the $0.50 price reported by decentralized exchange oracles.

This decision sparked discussions within the crypto community, with some experts questioning its legality.

Meanwhile, Bitget CEO Gracy Chen criticized HyperLiquid’s handling of the JELLY delisting and warned it could follow the path of FTX. The exec argued that the decision, made by a small group of validators, raised concerns about decentralization.

Chen also highlighted structural flaws, such as mixed vault risks and a lack of transparency. Her concerns were echoed by BitMEX co-founder Arthur Hayes, who also questioned HyperLiquid’s decentralization claims.

HyperLiquid’s Risk Management Updates

In light of these events, HyperLiquid has announced several key changes to its risk management systems.

First, the Liquidator vault within HLP will have stricter limits, meaning it will hold a smaller portion of the total HLP account value. It will also be rebalanced less often, and a more advanced system will be used to handle liquidations.

Second, the automatic deleveraging (ADL) process will only activate if the Liquidator vault’s losses exceed a certain limit. This will help prevent funds from being automatically moved from other vaults to cover losses.

Third, the platform will adjust open interest (OI) caps more dynamically based on market size to ensure they better reflect current conditions. Lastly, an on-chain voting system will allow validators to decide whether to remove assets that fall below certain thresholds.

“Yesterday is a good reminder to stay humble, hungry, and focused on what matters: building a better financial system owned by the people. Hyperliquid is not perfect, but it will continue to iterate and grow through the collective efforts of builders, traders, and supporters.”

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]]> https://earlybirdsinvest.com/hyperliquid-announces-key-risk-management-updates-following-jelly-market-incident/feed/ 0 27832 What is a Jelly Crypto Drama? Is Binance trying to interfere? https://earlybirdsinvest.com/what-is-a-jelly-crypto-drama-is-binance-trying-to-interfere/ https://earlybirdsinvest.com/what-is-a-jelly-crypto-drama-is-binance-trying-to-interfere/#respond Wed, 26 Mar 2025 21:25:16 +0000 https://earlybirdsinvest.com/what-is-a-jelly-crypto-drama-is-binance-trying-to-interfere/ A coordinated group of suspected whales, backed by major cryptocurrency exchanges such as Binance and OKX, manipulated the price of jelly tokens with high lipid (hype) DEX.

Wallets linked to several major CEXs opened huge high-lipid jelly jelly shorts, plunging the crypto community into frenzy, and the hype token crashed over 20% in one stage.

Analytics Platform LookonChain discovered market manipulation of jelly with high lipids

According to LookonChain, the first wallet performed the huge disadvantages of jelly, a huge short position of jelly while simultaneously getting the jelly token outside.

The traders were then discovered by removing the margin and took over a loss of $4.5 million in short positions due to Hyperliquid’s HLP (built-in Market Enactment Protocol). At the worst, the short position exposed HLP to a loss of over $6 million.

These shenanigans were taking place in short positions, but another wallet address from Hyperliquid opened a long order in Jelly, which at one point exceeded $12 million.

This was followed by the whale buying back the jelly, driving the loss of the original short position to more than $12 million.

Market capitalization has increased more than five times from $10 million to over $50 million as trainers caused a short squeeze in the token. Jelly is currently down to a market capitalization of $25 million, but if it had skyrocketed to $150 million, Hyperliquid would have faced full liquidation.

Following the price manipulation of jelly on the whale platform, Hype, the price of traditional tokens, fell sharply. Initially it fell from over $16 to under $13.

However, Hyperliquid avoided the huge losses he had faced as he listed the jelly and closed his short position. Since abolishing liquidation and avoiding it, the hype has been traded for $14.84.

High lipids (hype) avoid liquidation and while jelly is listed, Binance and OKX notably list jelly for futures trading

(Coinecko)

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ZachxBT reveals connections between many major exchanges and high lipid wallets

While the dangers and drama for the time being seemingly end up due to high lipids, everyone’s favorite chain detective Zachxbt quickly delved into this issue.

He discovered that two high lipid wallets involved in jelly price manipulation, 0x20E8 and 0x67F, connect to centralized exchanges such as OKX, MEXC, BYBIT, and BINANCE. Both addresses demonstrate interactions and receive funds from these exchanges before carrying out attacks on high lipids.

Many people within the Crypto community believe this attack on high lipids could be a coordinated attack with a major exchange to close the highly successful hyperglycemic Dex.

This suspicion was further promoted during the drama as both OKX and Binance announced they would list a permanent pair of jelly meme coins.

It appears to be a big coincidence that both exchanges chose to list roughly the same tokens as fully liquidating high lipids for market manipulation on the platform.

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High lipids have been almost liquidated by multiple malicious actors due to Jelly Meme Coin price manipulation

  • High lipids were $12 million at one time point, but later closed the position by listing jelly.

  • Zachxbt discovered that two malicious wallets with high lipids are newly funded by Binance and OKX

  • Many people in the crypto community believe that attacks on high lipids are a major exchange attempt to kill competition

  • Both OKX and Binance decided to list Jelly because high lipids were facing platform liquidation.

What is the posting jelly crypto drama? Is Binance trying to interfere? It first appeared in 99 Bitcoin.

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