Hyperliquid has announced the delisting of JELLY perpetual contracts following evidence of suspicious market activity. The decision was shared on Discord and confirmed in a post on X earlier today after the network’s validator set convened and voted to remove the trading instrument to protect market integrity.
The delisting comes with assurances from the Hyper Foundation that affected users—excluding flagged addresses—will be fully reimbursed for any losses incurred during the incident.
Suspicious Market Activity Tied to JELLY Perpetual Contracts
The delisting followed what Hyperliquid described as “evidence of suspicious market activity” tied to JELLY perpetual contracts. While the details of the activity remain undisclosed, it suspects that such an occurrence involved irregular trading patterns, potential market manipulation, or exploitative behavior.
In response, Hyperliquid’s validator set—a group responsible for maintaining network integrity—held an emergency meeting and voted unanimously to remove JELLY’s perpetual contracts from its platform.
The platform has pledged automatic reimbursement for affected users for all JELLY perpetual contracts trading losses, except for flagged accounts suspected of involvement in suspicious activities. The compensation will rely on on-chain data and does not require users to submit tickets or claims manually.
Despite the incident, the platform’s primary liquidity pool (HLP) appears unaffected, reporting a positive net income of approximately $700,000 in the past 24 hours.
Lessons from Previous Hyperliquid Incidents
Earlier this month, Hyperliquid suffered a $4 million loss during a massive Ether liquidation. Although the liquidation mechanism functioned as intended, it forced the HLP vault to assume the opposing side of the trade, thereby absorbing the $4 million loss.
The trader walked away with a profit of $1.8 million, which caused Hyperliquid users to question whether the transaction was an exploit or merely a loophole in the system.
In response, the platform increased margin requirements for traders to reduce systemic risks tied to large positions.
By taking decisive action and prioritizing user protection, Hyperliquid has demonstrated its commitment to maintaining market integrity—a critical factor for long-term success in competitive DeFi markets.
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