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Hyperliquid delists JELLY perps after suspicious activity

Hyperliquid delists JELLY perps after suspicious activity

GrafaGrafa2025/03/27 06:20
By:Mahathir Bayena

Hyperliquid (CRYPTO:HYPE) has delisted perpetual futures contracts for the JELLY token following evidence of suspicious trading activity, with most affected users set to receive automatic reimbursements.

The Hyper Foundation, the platform’s nonprofit arm, will compensate impacted traders based on on-chain data, excluding flagged addresses.

“All users apart from flagged addresses will be made whole from the Hyper Foundation,” Hyperliquid stated.

The decision follows broader efforts to stabilise the platform after recent volatility, including a $4 million loss in March linked to a whale trader’s ETH (CRYPTO:ETH) liquidation.

Despite the JELLY incident, Hyperliquid’s primary liquidity pool, HLP, reported a $700,000 net income over the past 24 hours.

On March 14, the exchange introduced a policy requiring traders to maintain a 20% collateral margin on certain positions to mitigate risks from large trades.

JELLY’s volatility has drawn scrutiny.

Launched in January by Venmo co-founder Iqram Magdon-Ismail as part of the JellyJelly Web3 project, the token initially surged to a $250 million market cap before dropping to approximately $25 million as of March 26.

A notable incident on March 14 involved a $6 million short position on JELLY. A trader allegedly self-liquidated by artificially inflating the token’s price, which could have triggered a “full liquidation” for Hyperliquid if JELLY’s market cap had reached $150 million, according to AP Collective founder Abhi.

Hyperliquid has faced broader systemic risks in leveraged trading. On March 12, a whale trader’s $200 million ETH long position liquidation resulted in a $4 million loss for HLP.

In response, the platform has tightened margin requirements to reduce exposure to high-risk events.

At the time of reporting, the Hyperliquid (HYPE) price was $14.51.

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Disclaimer: The content of this article solely reflects the author's opinion and does not represent the platform in any capacity. This article is not intended to serve as a reference for making investment decisions.

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