Record liquidation on Hyperliquid resulted in the complete depletion of more than 1,000 trader wallets and placed 6,300 additional accounts in loss territory, according to on-chain leaderboard data. Among the worst affected, 205 wallets experienced losses exceeding $1 million each, while the largest single position saw over $700 million wiped out in a short squeeze.
Market turmoil stemmed from a sudden risk-off shift following announcement of 100 percent tariffs on Chinese imports, which triggered a cascading sell-off across major cryptocurrencies. Bitcoin briefly dipped below $110,000, and ether fell under $3,700, reflecting accelerated deleveraging and a spike in forced liquidations across derivatives platforms.
Liquidation metrics from CoinGlass indicated a total of $19 billion wiped out in a 24-hour span, marking the largest single-day liquidation in crypto history by dollar value. The actual figure may exceed reports, as major venues such as Binance report liquidations on delayed timelines. Hyperliquid’s concentrated exposure to high-leverage positions amplified losses on the platform.
Analysis of Hyperliquid leaderboard patterns revealed a net transfer of $951 million to short-selling participants, underscoring elevated vulnerability of leveraged long bets. Market participants noted that the ongoing U.S. government shutdown compounded volatility by delaying key economic indicators and heightening uncertainty around fiscal policy outcomes.
Risk management capabilities and margin requirements for crypto derivatives platforms face renewed scrutiny following the event. Observers highlight the need for enhanced liquidation backstops and improved transparency in real-time reporting to mitigate systemic risks. The episode underscores persistent sensitivity of crypto markets to macroeconomic shocks and the potential for rapid capital erosion under extreme stress conditions.
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