Hyperliquid says suspicious HYPE shorting came from ex-employee activity

According to the co-founder, the person is no longer affiliated with Hyperliquid Labs, and the wallet’s activity doesn’t reflect the team’s standards or values.

The statement follows weeks of back-and-forth online. Community members, including the user cobe.hype, argued that the address could be connected to the team. They pointed to a November episode in which the wallet allegedly sold roughly 4,000 HYPE, worth about $134,000, in a single day. In chats and threads, that was enough to spark a familiar storyline: an “insider” short and a quiet attempt to unload into the market.

The co-founder pushed back, saying Hyperliquid enforces a strict internal trading policy. Employees and contractors are barred from trading HYPE derivatives, meaning they can’t open either shorts or longs. The policy also prohibits trading based on material nonpublic information, as well as sharing that information with third parties.

The wallet debate surfaced as Hyperliquid’s ecosystem is also arguing about token accounting. Earlier, Hyper Foundation put to a validator vote how to treat HYPE accumulated on the system “keyless” address tied to the Assistance Fund. Those tokens are purchased automatically using fee revenue and sent to an address with no private key. The foundation’s view is that the balance should be treated as economically burned and excluded from circulating supply and total supply calculations. At the time of the discussion, the amount in question was roughly $1 billion worth of HYPE.

According to DeFiLlama, Hyperliquid has logged more than $205 billion in 30-day perpetuals volume. The team is also continuing to expand the product side of the protocol, including the Based Streams format and its HIP-3 Growth Mode, which cuts fees on new markets and moves perpetual market launches closer to a “near-permissionless” model.