A coordinated group of whales, suspected of being backed by major cryptocurrency exchanges such as Binance and OKX, manipulated the price of the JELLY token on the Hyperliquid (HYPE) DEX.
Wallets linked to several major CEX’s opened a huge JELLYJELLY short on Hyperliquid and sent the crypto community into a frenzy, with the HYPE token crashing over 20% at one stage.
A massive whale with 124.6M $JELLY($4.85M) is manipulating the price of $JELLY(jellyjelly) to make Hyperliquidity Provider (HLP) face a loss of $12M!
He first dumped $JELLY, crashing the price and leaving HLP with a passive short position of 398M $JELLY($15.3M).
Then he bought… pic.twitter.com/kYcKshV4rl
— Lookonchain (@lookonchain) March 26, 2025
Analytics Platform Lookonchain Discovered The Market Manipulation Of JELLY On Hyperliquid
According to Lookonchain, the first wallet executed a huge short position of JELLY on Hyperliquid while simultaneously acquiring JELLY tokens externally.
The trader was then spotted removing their margin, causing Hyperliquid’s HLP (its built-in market-making protocol) to take over the $4.5 million loss on the short position. At its worst point, this short position exposed HLP to over $6 million in losses.
While these shenanigans were taking place with the short position, another wallet address on Hyperliquid opened a long order on JELLY and at one point was up over $12 million.
Following this, the whales proceeded to repurchase JELLY, driving the losses on the original short position to over $12 million.
After evidence of suspicious market activity, the validator set convened and voted to delist JELLY perps.
All users apart from flagged addresses will be made whole from the Hyper Foundation. This will be done automatically in the coming days based on onchain data. There is no…
— Hyperliquid (@HyperliquidX) March 26, 2025
Due to the traders causing a short squeeze on the token, its market cap shot up over 5x from $10 million to over $50 million. JELLY has now dropped to a $25 million market cap, but if it had spiked to $150 million, Hyperliquid would have faced full liquidation.
Following the whale’s price manipulation of JELLY on its platform, the price of its native token, HYPE experienced a sharp decline. It initially dropped from over $16 to under $13.
However, Hyperliquid has since delisted JELLY and closed the short position, thus avoiding any of the huge losses it was facing. Since delisting and avoiding liquidation, HYPE is trading back at $14.84.
(COINGECKO)
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ZachXBT Uncovers A Connection Between A Number Of Leading Exchanges And The Hyperliquid Wallets
it would even funnier if this outcome happened bc both JELLY manipulators 0x20e8 & 0x67f were freshly funded via Binance on Arbitrum
0xf5c07ec0acfc371c05a5de9882c8c90bfa1c071fa9356e6710e3db17d5abdd480xf171d527b9a277b895a02ca4b7c5ee081cb94a8932a60eeadbdcb02ea729b524…
— ZachXBT (@zachxbt) March 26, 2025
While the immediate danger and drama seem to be over for Hyperliquid, everyone’s favorite on-chain sleuth, ZachXBT, quickly delved into the matter.
He found that the two Hyperliquid wallets involved in the JELLY price manipulation, 0x20e8 & 0x67f, have connections to centralized exchanges such as OKX, MEXC, Bybit, and Binance. Both addresses demonstrate interactions and have received funding from these exchanges prior to carrying out the attack on Hyperliquid.
Many within the crypto community believe this attack on Hyperliquid could be a coordinated attack by the major exchanges to shut down the hugely successful Hyperliquid DEX.
This suspicion has been furthered as during the drama, both OKX and Binance announced it would be listing perpetual pairs for the JELLY meme coin.
It seems like a huge coincidence that both exchanges chose to list the same token that nearly caused Hyperliquid to be fully liquidated due to market manipulation on its platform.
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Multiple malicious actors caused Hyperliquid to nearly liquidate via a price manipulation of the JELLY meme coin
Hyperliquid were at one point on the hook for $12 million but have since delisted JELLY and closed the position
ZachXBT has found that the two malicious wallets on Hyperliquid were freshly funded from Binance and OKX
Many in the crypto community believe the attack on Hyperliquid could be an attempt by major exchanges to kill the competition
As Hyperliquid was facing liquidation of its platform, both OKX and Binance decided to list JELLY, the same token causing all of the panic
