Hyperliquid Says $57M SK Hynix Liquidation Wasn’t Its Fault, Blames Faulty Price Feed

Hyperliquid’s SK Hynix perpetual futures contract dropped 19% on Tuesday after a faulty price print from a South Korean trading venue triggered $57.4 million in liquidations across 960 accounts, with the exchange saying it did not operate the affected market.

What Triggered the Crash

The bad price came from NXT, a South Korean alternative trading venue with extended pre-market hours. An abnormal order valued a single SK Hynix share at 1,272,000 won, implying a 28.7% price collapse compared to the previous close of 1,785,000 won. The perpetual contract’s oracle pulled that flawed figure directly from the external venue, converting it into dollars as the reference price.

Built-In Limits Softened the Blow

The contract’s price bounds capped the movement at 19% below the session reference, preventing the full 28.7% implied drop from hitting traders. Still, roughly $17.3 million in realized losses were booked across long positions, while profitable short positions were partially deleveraged. Cross-margin design on the contract widened the impact compared to isolated-margin markets for other stocks on the same platform.

Who’s Responsible

Hyperliquid maintains it merely provides the underlying infrastructure, while Trade.xyz, operating under a framework called HIP-3, controlled the market’s price feed and oracle inputs. Validators can theoretically penalize Trade.xyz’s staked collateral, though any penalty would be burned rather than returned to affected traders.

SK Hynix reports earnings Wednesday, which could add further volatility to the same price feed involved in this incident. No compensation plan has been announced.

.The HYPE token price sat near $54.32 on Tuesday, down about 10%.