{"id":125881,"date":"2025-03-26T21:17:46","date_gmt":"2025-03-26T21:17:46","guid":{"rendered":"http:\/\/cryptospotters.net\/?p=125881"},"modified":"2025-03-26T21:17:46","modified_gmt":"2025-03-26T21:17:46","slug":"bitget-ceo-slams-hyperliquids-handling-of-suspicious-incident-involving-jelly-token","status":"publish","type":"post","link":"http:\/\/cryptospotters.net\/?p=125881","title":{"rendered":"Bitget CEO slams Hyperliquid\u2019s handling of \u201csuspicious\u201d incident involving JELLY token"},"content":{"rendered":"

Source: Cointelegraph.com NewsGracy Chen, CEO of cryptocurrency exchange Bitget, criticized Hyperliquid\u2019s handling of a March 26 incident on its perpetual exchange, saying it put the network at risk of becoming \u201cFTX 2.0.\u201d
\nOn March 26, Hyperliquid, a blockchain network specializing in trading, said it delisted perpetual futures contracts for the JELLY token and would reimburse users after identifying \u201cevidence of suspicious market activity\u201d tied to the instruments.\u00a0
\nThe decision, which was reached by consensus among Hyperliquid\u2019s relatively small number of validators, flagged existing concerns about the popular network\u2019s perceived centralization.
\n\u201cDespite presenting itself as an innovative decentralized exchange with a bold vision, Hyperliquid operates more like an offshore [centralized exchange],\u201d Chen said, after saying \u201cHyperliquid may be on track to become FTX 2.0.\u201d
\nFTX was a cryptocurrency exchange run by Sam Bankman-Fried, who was convicted of fraud in the US after FTX\u2019s abrupt collapse in 2022.\u00a0
\nChen did not accuse Hyperliquid of specific legal infractions, instead emphasizing what she considered to be Hyperliquid\u2019s \u201cimmature, unethical, and unprofessional\u201d response to the event.
\n\u201cThe decision to close the $JELLY market and force settlement of positions at a favorable price sets a dangerous precedent,\u201d Chen said. \u201cTrust\u2014not capital\u2014is the foundation of any exchange and once lost, it\u2019s almost impossible to recover.\u201d
\nSource: Gracy ChenRelated: Hyperliquid delists JELLY perps, citing \u2018suspicious\u2019 activity
\nJELLY incident
\nThe JELLY token was launched in January by Venmo co-founder Iqram Magdon-Ismail as part of a Web3 social media project dubbed JellyJelly.\u00a0
\nIt initially reached a market capitalization of roughly $250 million before falling to the single digit millions in the ensuing weeks, according to DexScreener.\u00a0
\nOn March 26, JELLY\u2019s market cap soared to around $25 million after Binance, the world\u2019s most popular crypto exchange, launched its own perpetual futures tied to the token.\u00a0
\nThe same day, a Hyperliquid trader \u201copened a massive $6M short position on JellyJelly\u201d and then \u201cdeliberately self-liquidated by pumping JellyJelly\u2019s price on-chain,\u201d Abhi, founder of Web3 company AP Collective, said in an X post.
\nBitMEX founder Arthur Hayes said initial reactions to Hyperliquid\u2019s JELLY incident overestimated the network\u2019s potential reputational risks.
\n\u201cLet\u2019s stop pretending hyperliquid is decentralised. And then stop pretending traders actually [care],\u201d Hayes said in an X post. \u201cBet you $HYPE is back where [it] started in short order cause degens gonna degen.\u201d
\nBinance launched JELLY perps on March 26. Source: BinanceGrowing pains
\nOn March 12, Hyperliquid grappled with a similar crisis caused by a whale who intentionally liquidated a roughly $200 million long Ether (ETH) position.\u00a0
\nThe trade cost depositors into Hyperliquid\u2019s liquidity pool, HLP, roughly $4 million in losses after forcing the pool to unwind the trade at unfavorable prices.\u00a0Since then, Hyperliquid has increased collateral requirements for open positions to \u201creduce the systemic impact of large positions with hypothetical market impact upon closing.\u201d\u00a0
\nHyperliquid operates the most popular leveraged perpetuals trading platform, controlling roughly 70% of market share, according to a January report by asset manager VanEck.\u00a0
\nPerpetual futures, or \u201cperps,\u201d are leveraged futures contracts with no expiry date. Traders deposit margin collateral, such as USDC, to secure open positions.
\nAccording to L2Beat, Hyperliquid has two main validator sets, each comprising four validators. By comparison, rival chains such as Solana and Ethereum are supported by approximately 1,000 and 1 million validators, respectively.\u00a0
\nMore validators generally lessen the risk of a small group of insiders manipulating a blockchain.\u00a0
\nMagazine: What are native rollups? Full guide to Ethereum\u2019s latest innovationRead More<\/a><\/p>","protected":false},"excerpt":{"rendered":"

Source: Cointelegraph.com NewsGracy Chen, CEO of cryptocurrency exchange Bitget, criticized Hyperliquid\u2019s handling of a March 26 incident on its perpetual exchange, saying it put the network at risk of becoming… <\/p>\n","protected":false},"author":0,"featured_media":0,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":[],"categories":[5],"tags":[],"_links":{"self":[{"href":"http:\/\/cryptospotters.net\/index.php?rest_route=\/wp\/v2\/posts\/125881"}],"collection":[{"href":"http:\/\/cryptospotters.net\/index.php?rest_route=\/wp\/v2\/posts"}],"about":[{"href":"http:\/\/cryptospotters.net\/index.php?rest_route=\/wp\/v2\/types\/post"}],"replies":[{"embeddable":true,"href":"http:\/\/cryptospotters.net\/index.php?rest_route=%2Fwp%2Fv2%2Fcomments&post=125881"}],"version-history":[{"count":0,"href":"http:\/\/cryptospotters.net\/index.php?rest_route=\/wp\/v2\/posts\/125881\/revisions"}],"wp:attachment":[{"href":"http:\/\/cryptospotters.net\/index.php?rest_route=%2Fwp%2Fv2%2Fmedia&parent=125881"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"http:\/\/cryptospotters.net\/index.php?rest_route=%2Fwp%2Fv2%2Fcategories&post=125881"},{"taxonomy":"post_tag","embeddable":true,"href":"http:\/\/cryptospotters.net\/index.php?rest_route=%2Fwp%2Fv2%2Ftags&post=125881"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}