Hyperliquid liquidity pool allegedly exploited, depositors take heavy losses

Cryptocurrency communities are raising concerns that Hyperliquid’s liquidity pool (HLP) has been manipulated, leaving depositors with heavy losses. According to @Copin_io on X, a trader allegedly exploited the system by using $10 million in USDC to open a 141,000 ETH long position worth $271.6 million, leveraging $23 million to control over $270 million. The position was liquidated at 160,000 ETH ($306.85 million), possibly as part of a deliberate strategy. By withdrawing funds to trigger self-liquidation, the trader shifted losses onto the HLP vault, which absorbed a $286 million ETH long. This tactic allowed them to move the market in their favor while hedging elsewhere for profit. As a result, some large investors are pulling funds from Hyperliquid, raising questions about potential changes to the platform’s trading and liquidity mechanics.