Hyperliquid incurred an estimated $10.63 million loss due to a sudden 230% surge in $JELLY’s price, leading to the token’s delisting and compensation plans for affected users.
Hyperliquid (HYPE) treasury had automatically assumed a $5 million short position in JELLY, which escalated into an unrealized loss of approximately $10.63 million as the token’s price surged within an hour, reaching $0.16004.
Had JELLY’s price neared $0.17, Hyperliquid’s treasury could have faced liquidation, with potential losses estimated at $240 million.
The sudden price spike is suspected to be the result of coordinated market manipulation. An address identified as 0xde95 reportedly opened a substantial short position of 430 million JELLY tokens on the HyperliquidX platform.
Shortly after, the same entity removed its margin, leading to the liquidation of $4.5 million in short positions, which Hyperliquid’s treasury subsequently assumed. At the same time, a newly created wallet, 0x20e8, opened a long position in JELLY, further influencing the market.
A massive whale with 124.6M $JELLY($4.85M) is manipulating the price of $JELLY(jellyjelly) to make Hyperliquidity Provider (HLP) face a loss of $12M!
He first dumped $JELLY, crashing the price and leaving HLP with a passive short position of 398M $JELLY($15.3M).
Then he bought… pic.twitter.com/kYcKshV4rl
— Lookonchain (@lookonchain) March 26, 2025
Delisting $Jelly
In response to these events, Hyperliquid’s validator committee voted to delist JELLY from the platform. The token was force-settled at $0.0095 to prevent further losses, with Hyperliquid citing a clear exploit and the need to protect HLP users.
After evidence of suspicious market activity, the validator set convened and voted to delist JELLY perps.
All users apart from flagged addresses will be made whole from the Hyper Foundation. This will be done automatically in the coming days based on onchain data. There is no…
— Hyperliquid (@HyperliquidX) March 26, 2025
The platform settled affected short positions at the original opening price of $0.0095, helping avoid additional damage. Hyperliquid assured users that funds remain secure and confirmed that the Hyper Foundation will fully compensate users whose wallets are not flagged.
“All users apart from flagged addresses will be made whole from the Hyper Foundation.”
These developments sparked discussions regarding the platform’s decentralization.
NEW 🚨
Massive drama going down on Hyperliquid involving $JELLY 👇
1.A trader opened a massive $6M short position on JellyJelly (a small coin, ~$20M mcap at the time).
2.This trader deliberately self-liquidated by pumping JellyJelly’s price on-chain. Essentially forcing… pic.twitter.com/AI01q7KnZR
— Abhi (@0xAbhiP) March 26, 2025
Arthur Hayes, a notable figure in the cryptocurrency space, commented on the situation, stating, “Let’s stop pretending that Hyperliquid is decentralized… I bet HYPE will soon return to square one because the decline will continue to decline.”
Let’s stop pretending hyperliquid is decentralised
And then stop pretending traders actually give a fuck
Bet you $HYPE is back where is started in short order cause degens gonna degen
— Arthur Hayes (@CryptoHayes) March 26, 2025
