Will HYPE Crypto Bounce Back: Binance Is JELLYJELLY Of Hyperliquid
The HYPE cryptocurrency from Hyperliquid, a decentralized perpetual futures protocol, has encountered disturbances stemming from a recent large holder manipulation controversy involving JELLYJELLY. Just yesterday, Hyperliquid chose to delist JELLYJELLY after a trader manipulated its price, leading to an unrealized rekt of $12 million for the Hyperliquid vault. Shortly after, Binance and OKX began listing JELLYJELLY crypto futures, navigating in volatile waters.
How did this unfold? The manipulator identified a crypto holder shorting
, dispose of it on DEXs, and then take a long position, squeezing the Hyperliquid vault.
This situation has sparked discussions about the potential for HYPE cryptocurrency to rebound from its recent 22% decline.
The Manipulation and The Crypto market Response to HYPE Crypto
The manipulation commenced with wallet “0xde96” executing a $6 million short position on JELLYJELLY. Concurrently, a whale plummeted the price on decentralized exchanges, compelling the HLP vault to sustain the short. Subsequently, a new wallet, “0x20e8,” took a long position on the crypto token, elevating its price and initially escalating the vault’s losses to $12 million.
Address 0xde9…c91 withdrew margin, unloading 398M $JELLY shorts onto Hyperliquid. As $JELLY surged to $0.04, its HLP vault endured a $10M unrealized wrecked.
— XBIT (@XBITDEX) March 27, 2025
Hyperliquid responded swiftly, suspending trading and removing the contract. The validators pointed to “suspicious trading market activity” and settled 392 million JELLYJELLY at $0.0095, generating a $703,000 profit for the vault.
price faced a downturn, plummeting up to 22% before recovering slightly to trade 10% lower.
This rapid action has ultimately instilled some confidence but revealed weaknesses in the Hyperliquid system.
JELLYJELLY, a memecoin on the Solana network, experienced a market cap of $25 million during the turmoil. Its price surged nearly 500% amid the manipulation, reaching a high of $50 million prior to Hyperliquid’s intervention.
Ultimately, Hyperliquid halted trading and delisted JELLYJELLY, vowing to compensate the majority of users through the Hyper Foundation.
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The Good, The Bad, The Ugly: Will HYPE Recover?
On another note, Binance and OKX opted to list JELLYJELLY futures amidst the discord, raising allegations of competitive sabotage.
Additionally, it has been revealed that the orchestrator of this large holder manipulation has sourced funds from wallets linked to Binance.
It would even be funnier if this outcome happened because both JELLY manipulators 0x20e8 & 0x67f were recently funded via Binance on Arbitrum
0xf5c07ec0acfc371c05a5de9882c8c90bfa1c071fa9356e6710e3db17d5abdd48
0xf171d527b9a277b895a02ca4b7c5ee081cb94a8932a60eeadbdcb02ea729b524…— ZachXBT (@zachxbt) March 26, 2025
The actions by Binance and OKX coincided with Hyperliquid’s struggles in the crypto market during the turmoil. Had JELLYJELLY’s trading market cap reached $150 million, the HLP vault would have been at risk of total liquidation, a fate that Hyperliquid narrowly avoided.
Currently, Hyperliquid has committed to technical enhancements to prevent further exploits in the crypto space. Increasing margin requirements to 20% for specific positions is one of the measures enacted following a prior ether incident.
The sentiment surrounding the future of HYPE crypto asset is currently divided. Some commend Hyperliquid’s prompt response and reimbursement strategy, viewing it as resilience. Others criticize its decentralized principles, highlighting the manual interference in the JELLYJELLY price and network node vote to delist, indicating centralized control.
At the same time, metrics show that Hyperliquid’s total value locked decreased from $283 million to $190 million after the incident. The recovery trajectory for HYPE cryptocurrency depends on restoring user trust and demonstrating that it can resist big investor manipulations.
With Binance and OKX in the fray, competition is intensifying, but Hyperliquid’s reactive measures will determine its advancement.
What goes down will eventually come back up.
FUD can be bothersome, but it builds resilience.
Act appropriately, then allow your users to make choices. You understand.
— CZ
BNB (@cz_binance) October 17, 2022
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Key Takeaways
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