On Wednesday, the memecoin POPCAT suffered a sharp decline after a manipulation incident on Hyperliquid, a top decentralized crypto exchange. According to DeFi researcher Hanzo’s analysis on X, an unidentified trader withdrew $3 million in USDC from OKX and spread it across 19 wallets on Hyperliquid about 13 hours before the disruption. They then built large long positions on POPCAT, with exposure estimated between $20 million and $30 million.
To create a false impression of demand, the trader placed a $30 million buy wall at $0.21, which drew in genuine buyers. However, when the trader suddenly removed the buy wall, POPCAT’s price plummeted, liquidating all long positions. The trader lost their $3 million collateral, and Hyperliquid’s HLP system absorbed the open positions, incurring an additional $4.9 million loss and worsening a market-wide selloff.
This is the third major disruption on Hyperliquid this year, raising concerns about its liquidity management and risk controls. After the event, the team took emergency steps to stabilize the market and paused its Arbitrum bridge, though deposits and withdrawals continued. Some in the community suspect the incident was a deliberate stress test or attack rather than a random liquidation.
POPCAT dropped about 43%, from $0.21 to $0.12, with total liquidations around $63 million. Hyperliquid’s native token, HYPE, also fell, trading at $38.25—down 7% for the week.
Frequently Asked Questions
Of course Here is a list of FAQs about the 30 million market manipulation on Hyperliquid framed in a natural tone with clear direct answers
Basic Understanding The What Happened
1 What is this 30 Million Hyperliquid story about
Its about a sophisticated trader who manipulated the price of a meme coin called POPCAT on the Hyperliquid exchange making a profit of around 30 million in a very short time
2 What is Hyperliquid
Hyperliquid is a decentralized exchange focused on perpetual futures trading allowing users to trade with leverage without a traditional intermediary
3 What is POPCAT
POPCAT is a meme coin similar to Dogecoin or Shiba Inu that originated on the Solana blockchain Its value is based almost entirely on community hype and speculation
4 So what exactly is market manipulation
Market manipulation is when someone artificially influences the price of an asset to make a profit In this case the trader used a series of deceptive trades to trick the market into thinking POPCATs price was rising so they could sell their own holdings at an inflated price
The How Did They Do It
5 How did the trader manipulate the price of POPCAT
They used a pump and dump scheme First they deposited a large amount of capital to create a massive long position Then they used a different wallet to buy a small amount of POPCAT on another exchange which caused Hyperliquids price oracle to register a massive price spike This triggered liquidations and forced buying pumping the price further
6 What is a price oracle and why was it key here
A price oracle is a service that feeds external market data into a blockchain Hyperliquids oracle saw the fake price spike on the other exchange and updated POPCATs price on its platform which was the loophole the manipulator exploited
7 What are liquidations and how did they help the manipulator
When you trade with leverage you borrow money If your trade moves against you your position gets automatically closed to prevent further losses The manipulators fake price spike caused many short positions to be liquid