Ah, Hyperliquid, that whimsical blockchain bazaar of trading, has decided to tighten the noose—er, I mean, increase margin requirements for its traders. This comes after a rather theatrical loss of $4 million, courtesy of a dramatic Ether (ETH) liquidation that would make even Shakespeare weep.
On the fateful day of March 12, a trader, perhaps feeling a bit too adventurous, liquidated a long position worth a staggering $200 million in Ether. The result? Hyperliquid’s liquidity pool, affectionately known as HLP, took a $4 million dive, unwinding the trade like a poorly knitted sweater. 🎭
Starting March 15, our dear traders will be required to maintain a collateral margin of at least 20% on certain open positions. This, according to Hyperliquid, is to “reduce the systemic impact of large positions with hypothetical market impact upon closing.” A mouthful, isn’t it? But hey, who doesn’t love a good jargon salad? 🥗
This incident, dear reader, is a classic tale of growing pains for Hyperliquid, which has emerged as the belle of the Web3 ball, the most popular platform for leveraged perpetual trading. 🕺
Hyperliquid assures us that the $4 million loss was not due to some nefarious exploit but rather a predictable consequence of its trading mechanics under extreme conditions. Because, of course, who could have seen that coming? 🙄
“[Y]esterday’s event highlighted an opportunity to strengthen the margining framework to address extreme conditions more robustly,” they proclaimed, as if they were unveiling a new line of luxury handbags. 👜
These changes, however, only apply in certain circumstances—like when traders are withdrawing collateral from open positions. But fear not! Traders can still dive into new positions with up to 40 times leverage. Because why not live dangerously? 🎢
Perpetual futures, or “perps,” are the darlings of leveraged futures contracts, with no expiry date. Traders deposit margin collateral—typically USDC (USDC) for Hyperliquid—to secure their open positions. It’s like a never-ending party, but with more risk and fewer snacks.
By withdrawing most of his collateral and liquidating his own position, the trader managed to cash out without incurring slippage—those pesky losses from selling a large position all at once. Instead, the losses were graciously absorbed by Hyperliquid’s HLP liquidity pool. How generous! 🎁
Leading perps exchange
As of March 13, HLP boasts a total value locked (TVL) of approximately $340 million, sourced from user deposits, according to DefiLlama. Quite the treasure chest, wouldn’t you say?
Launched in 2024, Hyperliquid’s flagship perps exchange has captured a whopping 70% of the market share, leaving rivals like GMX and dYdX in the dust, according to a January report by asset manager VanEck. Talk about a power move!
Hyperliquid touts a trading experience akin to a centralized exchange, with fast settlement times and low fees, though it’s less decentralized than other exchanges. A bit of a paradox, isn’t it? 🤔
As of March 12, Hyperliquid has clocked approximately $180 million per day in transaction volume, according to DefiLlama. A bustling marketplace indeed!
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2025-03-13 23:16