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Trader’s $7M Bet on JELLYJELLY Leads to $1M Loss on Hyperliquid

In a shocking turn of events, a trader has reportedly lost nearly $1 million after attempting to manipulate the market by depositing $7.167 million across three separate accounts on Hyperliquid. The incident highlights significant concerns over the exchange’s liquidation process and its potential impact on traders.

According to blockchain analytics firm Arkham Intelligence, the trader attempted to influence JELLYJELLY prices through leveraged trades. Their strategy included making long positions worth $2.15 million and $1.9 million in JELLYJELLY across two separate accounts. Additionally, a third account held a much larger position of approximately $4.06 billion.

The trader’s aggressive approach led to losses exceeding $1 million, with some speculating that the incident may have contributed to market volatility. The event has sparked concerns about the exchange’s ability to manage liquidations, particularly in volatile markets like memecoins.

It is worth noting that this is not the first significant loss faced by Hyperliquid. Earlier this month, a whale liquidated a $200 million long position in Ethereum, resulting in a $4 million loss for the platform. These incidents raise questions about the exchange’s ability to handle large-scale market movements and the potential consequences for traders.

As a result of the incident, all users apart from flagged addresses will be made whole by the Hyper Foundation, with automatic payments facilitated through blockchain data.

This recent development serves as a stark reminder of the importance of responsible trading practices and highlights the need for greater transparency and accountability within the cryptocurrency market.

Source: https://cryptotale.org/traders-7m-bet-on-jellyjelly-leads-to-1m-loss-on-hyperliquid/