Hyperliquid News Today: DeFi’s High-Leverage Trading Environments Increase Systemic Spoofing Threats

Hyperliquid, a rapidly expanding decentralized perpetuals exchange, has experienced its third significant market manipulation incident in 2025, this time centered around the Solana-based

POPCAT. The event, which took place on November 12, resulted in $4.9 million in bad debt for the platform’s HLP liquidity vault, in markets with high leverage and low liquidity.

The exploit began when an unidentified individual withdrew $3 million in

from OKX and split it among 19 separate wallets. With these funds, the attacker opened $26 million worth of positions on Hyperliquid, creating a substantial $20 million buy wall at $0.21 to give the illusion of strong demand. The move was calculated: once the buy wall was removed, POPCAT’s price plunged 30% in seconds, causing a wave of liquidations. Although the attacker sacrificed $3 million of their own money, onto Hyperliquid’s HLP liquidity providers.

This is the third time this year Hyperliquid has suffered such an attack, following similar incidents in March and July. The recurring nature of these exploits points to a fundamental risk in decentralized perpetuals trading, where limited liquidity and high leverage make the platforms vulnerable to spoofing and timing-based strategies.

remained secure, but the episode exposes the difficulties of managing volatile assets with shallow order books.

The exchange’s rapid expansion—now reporting daily trading volumes exceeding $10 billion—and its dependence on community-backed liquidation pools have made it an attractive target. Experts point out that the attacker took advantage of the platform’s 50x leverage on select tokens, using 5x leverage on POPCAT to intensify the price crash.

against these manipulative tactics has sparked debate about whether decentralized exchanges can scale safely in today’s market.

Hyperliquid’s ongoing issues mirror larger problems within the crypto derivatives sector. The platform’s liquidity vault, intended to cover losses from liquidations, is now absorbing the impact of repeated attacks. Although the company has yet to announce updates to its risk controls, these events have led to renewed calls for tighter regulation of high-leverage trading on decentralized platforms.

The POPCAT incident also illustrates the increasing complexity of market manipulation in crypto. Unlike traditional finance, where regulations can discourage such actions, decentralized exchanges often lack the mechanisms to identify or stop spoofing as it happens.

open to coordinated exploits that take advantage of the relationship between leverage, liquidity, and governance.

As the digital asset market develops, the recurrence of these attacks may prompt decentralized exchanges to rethink their risk management and capital strategies. For now, Hyperliquid’s repeated breaches serve as a warning to both investors and developers in the space.