Lightning Rally, Faster Crash
At 05:50 a.m. Beijing time on 27 August, the decentralized perpetuals exchange Hyperliquid witnessed a textbook manipulation event. Its pre-launch market for token XPL rocketed almost 200 % in five minutes—from $0.60 to a fleeting $1.80—then collapsed just as quickly. The move wiped out $17.67 million in short positions and left the broader market untouched; CEXs such as Binance and Bitget recorded no comparable price action.

Two Wallets, $27.5 Million Profit
On-chain forensics via HypurrScan reveal a two-pronged attack:

1. Address 0xb9c… began building a position two days earlier, funneling 10.98 million USDC into Hyperliquid in six tranches, then adding another 4.99 million USDC at 05:35. Between 05:36 and 05:53 the wallet layered leveraged longs—$20 k to $200 k clips—then closed them into the spike. After price retraced to ~$0.60 it reopened longs. Net haul: ~$16 million.

2. Address 0xe417… (DeBank: silentraven) quietly amassed 21.1 million XPL at an average entry of $0.56 using $9.5 million in margin. When cascading liquidations triggered at $1.1–$1.2, the position auto-closed for a $12.5 million gain.

Combined, the duo extracted $27.5 million in roughly 30 minutes.

Rumors briefly linked the wallets to Justin Sun because of a five-year-old ETH transfer to a Sun-associated address; no direct evidence has surfaced.

Structural Fault Lines Exposed

• Single-Oracle Risk
  Hyperliquid derives its mark price solely from its internal order book. With no external reference, a determined actor can push price through liquidation thresholds at will.

• No Position-Size Limits
  Absent per-user caps, whales can accumulate outsized exposures and effectively become the market.

• Illusion of “Safe” Hedging
  Low-leverage shorts—1× “hedges” widely viewed as low-risk—proved lethal. One user (@Cbb0fe) lost $2.5 million on a 10 % hedge despite posting ample collateral, vowing “never again to touch an isolated market.”

Take-Away: Respect the Edge Cases
The XPL episode is more than a manipulation case study; it is a live-fire demonstration of weaknesses in DeFi perpetuals: brittle oracles, absent concentration controls, and leverage that turns even conservative strategies into cannon fodder. Until protocols harden these rails—and traders price tail risks accordingly—the next five-minute storm is only a whale away.