HLP Reserve Balance Drops to $351 Million, Down 27.7% from Pre-Incident Level

BlockBeats News, March 13th, according to official data, since yesterday's occurrence of the "large fund high-leverage traders extracting unrealized profits to artificially increase liquidation price for closure" event, the Hyperliquidity Provider (HLP) balance has decreased from the original $486 million to $351 million, a decrease of 27.7%.

BlockBeats Note: Yesterday, a whale trader who opened a 50x ETH long position utilized Hyperliquid's liquidation engine to exit, artificially inflating the liquidation price by withdrawing unrealized profits, triggering liquidation and allowing Hyperliquid to take over the entire position at the liquidation price. Hyperliquid's liquidation address spent 7 hours continuously slowly closing the position, and the HLP insurance fund ultimately absorbed the whale's long position loss of $3.23 million. Currently, Hyperliquid has updated the maximum leverage for BTC and ETH to 40x and 25x, respectively, to increase the maintenance margin requirement for larger positions and provide better buffering for larger position liquidations.