Tonight, Hyperliquid, which had just experienced the "insider whale" long-order cashing-out incident, encountered another position farce. Due to the abnormal price movement of a meme token called JELLY, Hyperliquid's counterparty vault was on the verge of liquidation, and the entire protocol vault was at risk of returning to zero. At the same time, CEX also took advantage of the situation and launched JELLY contracts to launch targeted sniping and hunting of Hyperliquid.
As of now, Hyperliquid has forcibly removed the JELLY contract and liquidated its JELLY short positions at a favorable price, and the protocol vault has not suffered any losses. At the same time, the price of HYPER briefly plunged, falling from around $16 to $13 before rebounding and currently remaining above $14. This move also triggered heated discussions in the community about the competition between CEX and Perp DEX, as well as the issue of on-chain protocol centralization.
Note: This incident is still developing and BlockBeats will continue to pay attention to it.
According to market data, the Meme coin JELLYJELLY has risen by 515% in the past hour and is currently priced at $0.034, with a market value of $38.11 million; while HYPE has fallen by 17% in the past hour and is currently priced at $14.37, down 10% from when it "took over the JELLY short position."
BlockBeats previously reported that Hyperliquid Vault received $5 million in JELLY short positions due to automatic liquidation by traders.
According to hypurrscan data, as the price of JELLY coin skyrocketed, the current floating loss of this position has reached 12.368 million US dollars (opening price 0.01129 US dollars).
According to hypurrscan data, a newly created address starting with 0x20e8 opened a 3x JELLY long order on Hyperliquid, with an entry price of $0.01129. The floating profit once exceeded $8 million, and the current floating profit is $5.58 million.
According to Lookonchain monitoring, a whale holding 126 million JELLY (jellyjelly) coins is manipulating the coin price.
The address first sold JELLY to crash the price, leaving HLP with a passive short position of 398 million JELLY (about $15.3 million).
The address then bought back the JELLY, driving up the price and causing HLP to lose nearly $12 million.
On-chain data analyst @ai_9684xtpa said that the $5 million jellyjelly short position that Hyperliquid took over due to automatic liquidation by traders has suffered a floating loss of $10.63 million (approximately $6 million as of press time). If the counterparty raises the price of the currency to around $0.17, Hyperliquid Vault will face liquidation and lose the $240 million currently held.
Crypto KOL Crypto Skanda (@thecryptoskanda) posted on social media, "suggesting" Binance to launch JELLY spot trading, or simply claiming to consider launching JELLY trading, and use its own influence to further increase the price of JELLY to liquidate Hyperliquid, a competitor.
In response, Binance co-founder He Yi said, "OK, got it."
As of press time, JELLY is currently priced at $0.0328, which is only 24% higher than when He Yi responded, and has not had a significant impact on the price of the currency (compared to the 500% increase tonight).
BlockBeats previously reported that a trader who opened a JELLY short order was automatically liquidated, causing Hyperliquid Vault to take over a JELLY short position worth $5 million. As of press time, the position had a floating loss of $9.02 million.
According to the analysis of on-chain data analyst @ai_9684xtpa, if the counterparty raises the price of JELLY to around US$0.17, Hyperliquid Vault will face liquidation and lose all the US$240 million it currently holds.
According to official news, OKX announced that it will launch the JELLYJELLY perpetual contract.
According to official news, Binance will launch JELLYJELLY and MAVIA U based perpetual contracts.
On-chain data analyst Yu Jin wrote that the JELLY incident will at most explode the address that currently holds the JELLY short position, and will not affect the other two strategy addresses of the HLP vault.
There are 50 million funds in the liquidator's address, and the current liquidation price of the 398 million JELLY short orders is 0.141 US dollars. The current price of JELLY is $0.033. To "explode" the liquidator's address, JELLY needs to rise more than 3 times.
According to market news, Hyperliquid chose to delist JELLY after OKX and Binance announced the launch of JELLY contracts.
According to market data, Hyperliquid chose to delist JELLY after OKX and Binance announced the launch of JELLY contracts. Subsequently, HYPE rose by about 20% in a short period of time, and the currency price was temporarily reported at US$14.3.
Perhaps affected by Hyperliquid's removal of JELLY, JELLY fell 60% in a short period of time and is currently quoted at US$0.0248.
According to market news, Hyperliquid delisted JELLYJELLY and settled the short orders it took over at $0.0095 (much lower than the market price) without losing any funds.
Hyperliquid responded on Discord that after discovering suspicious market activities, the validator committee voted to delist the JELLY perpetual contract.
Except for marked addresses, all user losses will be fully compensated by the Hyper Foundation. Compensation will be automatically executed in the next few days based on on-chain data, without the need to submit a work order. The specific implementation plan will be detailed in subsequent announcements. Similar to other public chains, validators often need to collectively negotiate and take decisive actions to maintain the integrity of the network. Hyperliquid will prioritize upgrading the robustness and transparency of the voting system.
It is also recorded that the current 24-hour net profit and loss of HLP (Hyperliquid Protocol) is approximately 700,000 USDC. Technological improvements will be made simultaneously, and the experience gained from this incident will make the network more perfect. More details to come.
Arthur Hayes posted on social media that Hyperliquid could not handle the JELLY incident, which was not decentralized at all, and don’t think that traders really care about it. He bet that HYPE would soon fall back to the starting point.
According to Lookonchain monitoring, Hyperliquid liquidated 392 million JELLY (about 3.72 million US dollars) at a price of US$0.0095 before delisting JELLY. It did not suffer any losses but instead made a profit of US$703,000.
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