HyperLiquid’s TVL Drops to $150 Million Amid Centralization Concerns
HyperLiquid, a decentralized derivatives exchange, has seen its total value locked (TVL) decrease from $540 million to $150 million in two months. Yield rates have dropped to around 1%, posing a lower return than traditional bank accounts.
The decline followed an exploit involving the token JELLY, where a user manipulated price through short-selling and purchasing on illiquid exchanges, leading to losses for HyperLiquid’s vault. Concerns arose over the platform's decentralization after it forcefully closed the JELLY market at $0.0095, despite oracles indicating a price of $0.50, raising questions about control within the protocol.
Key points include:
- TVL decreased from $540 million to $150 million
- Yield rates now around 1%
- Exploit involved manipulation of the JELLY token
- Concerns over HyperLiquid's centralization response
- Trading volume remains strong, exceeding $70 billion this month
- Native token HYPE lost 60% of value, dropping market cap from $9.7 billion to $4.6 billion
To address concerns, HyperLiquid is implementing an on-chain validator system for asset delisting decisions in the future.