Hyperliquid, a blockchain network specializing in trading, increased margin requirements for merchants after its liquidity pool lost millions of dollars during a massive ether (ETH) liquidation, the network said.
On March 12, a merchant intentionally liquidated an ether position of around $ 200 million, which caused Hyperliquid to lose $ 4 million.
From March 15, hyperliquid will begin to demand that traders maintain a collateral margin of at least 20% on certain open positions to “reduce the systemic impact of large positions with a hypothetical impact on the market on the fence”, declared hyperliquid in a post of March 13.
The incident highlights the growing pains faced with hyperliquid, which has become the most popular platform of web3 for perpetual leverage.
The hyperliquid has adjusted the margin requirements for traders. Source: Hyperliquidal
Hyperliquid said that the loss of $ 4 million was not from a feat but rather a predictable consequence of the mechanics of its trading platform in extreme conditions.
“”[Y]The EsterDay event highlighted the opportunity to strengthen the margin frame to resolve the extreme more robust conditions, “said Hyperliquid.
These modifications only apply in certain circumstances, such as when merchants withdraw the guarantees of the open positions, said hyperliquid. Traders can always assume new positions with a lever effect of up to 40 times.
Perpetual, or “PERPS” term contracts are leveraging contracts without expiration date. Traders deposit margin guarantees – generally USDC (USDC) for hyperliquid – to secure open positions.
By withdrawing the majority of his warranty and liquidating his own position, the merchant has actually collected his profession without causing a shift – or losses by selling an important position at the same time.
Instead, these losses were supported by the HLP hyperliquid liquidity pool.
Hyperliquidal HLA has more than $ 350 million on TVL. Source: Defillama
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Main Perps exchange
As of March 13, HLP had a total locked value (TVL) of around $ 340 million from user deposits, according to Defilma.
Launched in 2024, according to a January report, the active director of the asset director exceeded 70% of the market share of Hyperliquid Perps Exchange captured 70% of the market share.
The hyperliquide praises a commercial experience comparable to a centralized exchange, with fast settlement times and low costs, but is less decentralized than other exchanges.
As of March 12, hyperliquidal timed around $ 180 million per day of volume of transactions, according to Defilma.
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