Hyperliquid HLP

Risk Score 51/100·BValue

$223MTVL·$52.5BFDV·DerivativesWebsite →

Elevated risk — novel vault mechanics with demonstrated exploitation history, partially offset by strong trading volume and aggressive fee-funded buyback program.

Risk Breakdown

Top Risks

HLP vault automatically inherits liquidated positions including illiquid tokens, enabling repeated economic design exploits — confirmed twice: the March 2025 JELLY incident ($12M unrealized vault losses) and the April 2026 FARTCOIN ADL attack where seven coordinated wallets extracted $2.78M by opening an unliquidatable $15M position, demonstrating this is a persistent, unresolved design vulnerability.

ICE CEO publicly called for Dodd-Frank enforcement against Hyperliquid on May 27, 2026, while CME and ICE formally raised manipulation concerns with U.S. regulators. HYPE spot ETFs (Bitwise, 21Shares, $136M+ inflows) simultaneously increase SEC/CFTC scrutiny surface. The platform has no KYC, blocks U.S. users, was previously linked to DPRK-affiliated actor reconnaissance in April 2026, and was identified as laundering infrastructure in the May 2026 THORChain hack, compounding enforcement exposure.

The protocol's validator set is small (~20 validators), enabling rapid consensus actions like delisting tokens and settling positions at arbitrary prices within minutes, raising centralization concerns around emergency interventions.

Socialized loss mechanism means HLP depositors bear counterparty risk from all perpetual trading on the platform, with no per-asset exposure caps limiting concentration risk on illiquid listings.

Frequently Asked Questions

Is Hyperliquid HLP safe to use?

Hyperliquid HLP receives a C- risk grade (51/100) from Hindenrank, where lower scores indicate lower risk. Elevated risk — novel vault mechanics with demonstrated exploitation history, partially offset by strong trading volume and aggressive fee-funded buyback program. Hyperliquid HLP is the protocol-owned market-making vault on Hyperliquid, a custom L1 perpetual futures exchange with ~$450M in vault deposits. Its C grade reflects novel vault mechanics that automatically inherit liquidated positions across all markets, the March 2025 JELLY manipulation incident, and centralization concerns around a small validator set that can delist tokens and settle positions within minutes.

What are the main risks of using Hyperliquid HLP?

The key risks identified for Hyperliquid HLP are: (1) The HLP vault automatically takes over positions from liquidated traders, including on illiquid tokens. In March 2025, a trader manipulated the JELLYJELLY token price and forced the vault to absorb $12M in losses before validators intervened by delisting the token. (2) Hyperliquid runs on its own custom blockchain with approximately 20 validators who can make rapid emergency decisions, including delisting assets and settling positions at chosen prices. (3) HLP depositors are exposed to all perpetual markets listed on the platform simultaneously with no per-market isolation.

What is Hyperliquid HLP's risk score breakdown?

Hyperliquid HLP scores 51/100 across eight risk dimensions: Mechanism Novelty: 6/15, Interaction Severity: 10/20, Oracle Surface: 5/10, Documentation Gaps: 2/10, Track Record: 8/15, Scale Exposure: 10/10, Regulatory Risk: 6/10, Vitality Risk: 4/10. The highest risk area is Scale Exposure at 10/10.

How does Hyperliquid HLP compare to other Derivatives protocols?

Among 57 rated Derivatives protocols on Hindenrank, Hyperliquid HLP ranks #51 by safety (lowest risk score = safest). Its 51/100 risk score and C- grade place it among the riskier Derivatives protocols.

Has Hyperliquid HLP ever been hacked or exploited?

Hyperliquid HLP scores 8/15 on the Track Record risk dimension, indicating some history of security incidents or exploits. Higher scores reflect more severe or frequent incidents. Review the full risk report for details.

Last scanned 2026-05-30

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