
Hyperliquid Saved Itself a $15 Million Loss, but Sparked Criticism - Ep. 807
Unchained
Controversial Pricing and Community Backlash in Crypto
This chapter explores the backlash against a crypto platform's arbitrary pricing decision, highlighting community concerns and the need for scalable solutions. Promotional segments for BitKey and Focal precede discussions of audience reactions and the involvement of major industry players like Binance and OKEx.
Perpetual swap DEX Hyperliquid suffered a whale attack and was on the brink of losing $15 million. It promptly responded in a way that generated a fair amount of controversy.
The founder and CEO of Ambient Finance Doug Colkitt joined the show to explain:
- How perp swaps work
- How a whale used the low-liquidity memecoin $JELLY to attack Hyperliquid’s vault
- How Hyperliquid’s response broke DeFi taboos around decentralization, oracles, etc.
- Criticisms of and justifications for the team’s decisions
- What can be done to prevent similar attacks in the future
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Guest
- Doug Colkitt, Founder and CEO of Ambient Finance
Links
- Accounts of the $JELLY whale attack on Hyperliquid and its response
- X: The story
- X: Nuking the vault
- X: How Hyperliquid responded
- Arguments for and against Hyperliquid’s solution:
- ZachXBT: ZachXBT calls out alleged hypocrisy
- Jordi Alexander: Shorting on a perp is not robust
- Jose Maria Macedo: How do they override the oracle price?
- Doug: Closing positions at an arbitrary price
- Gracy Chen: Casting doubts on integrity
- Steven.hl: In defense of HL
- Kam: Of course quorum was reached easily
- What precedent Hyperliquid’s actions set
- Kevin Zhou: Binance and OKX set a precedent
Timestamps:
👋 0:00 Intro
🤔 02:59 What is Hyperliquid?
🐳 05:16 How a whale used $JELLY to attack
⛔ 09:19 How Hyperliquid responded
📈 11:59 Why did Binance and OKX suddenly list the memecoin?
🤔 16:32 How did Hyperliquid ‘change the rules’ to protect themselves?
⚖️ 19:25 ‘Losses for thee, but not for me’: Hyperliquid’s hypocrisy?
💡 24:39 Doug’s ‘cleaner’ solution
👀 28:35 Will this have positive or negative knock-on effects?
🧹 31:20 Tidying up illiquid markets
📰 32:46 Crypto News Recap
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