Hyperliquid: A New Playground for Whales and Liquidation Hunters

1. Hyperliquid – Where Whales Showcase Strategies

Hyperliquid allows users to monitor large long/short positions in real-time, creating a "stage" where whales display their trading tactics. The transparency helps the community gain insights into the market but also fosters intense competition among traders of all sizes.

2. Major Liquidation Event and Its Consequences

On March 12, 2025, a trader opened a long ETH position worth over $300 million with high leverage. After withdrawing part of the margin, the position was liquidated, resulting in a $4 million loss for the Hyperliquidity Provider (HLP) vault. This event triggered a wave of capital withdrawals and a decline in the HYPE token's price.

3. Leverage Policy Adjustments

Following the significant liquidation event, Hyperliquid reduced the maximum leverage for BTC from 50x to 40x and for ETH from 50x to 25x. Additionally, the exchange now requires users to maintain at least 20% collateral when withdrawing funds from large positions, aiming to mitigate systemic risks and protect the platform from severe fluctuations.