Hyperliquid Attributes HYPE Token Shorting to Former Employee

Hyperliquid says ex-employee responsible for HYPE token shorting

Summary: Hyperliquid, a decentralized perpetual exchange, clarifies that a wallet involved in shorting the HYPE token belonged to a former employee. The company stresses its commitment to strict ethical standards for all its employees and contractors.

Key Takeaways:

Hyperliquid confirms that the wallet shorting HYPE is owned by a terminated former employee.
The platform adheres to stringent ethical standards for its team, including strict trading policies on the HYPE token.
Arthur Hayes has cited HYPE as one of the best narratives in the current market despite its recent price drop.

Clarification on HYPE Token Shorting Incident

Hyperliquid has addressed concerns from the community regarding a specific wallet that was suspected of offloading significant amounts of HYPE tokens. Co-founder Iliensinc announced on the Hyperliquid Discord channel that the wallet in question, identified by the address 0x7ae4…1028, is linked to an ex-employee who was dismissed in the first quarter of 2024.

"This individual is no longer affiliated with Hyperliquid Labs, and their actions do not reflect our team’s standards or values," Iliensinc stated.

This announcement comes after community member cobe.hype alleged that this wallet belonged to “one of the Hyperliquid team wallets” responsible for selling nearly 4,000 HYPE tokens (approximately $134,000) in one day during November.

Commitment to Ethical Trading Practices

In his Discord message, Iliensinc emphasized that Hyperliquid Labs has established a rigorous trading policy to guarantee that its team members uphold a high level of accountability—setting a benchmark for the industry.

“All individuals associated with Hyperliquid Labs, including employees and contractors, are bound by strict ethical standards regarding the HYPE token,” the co-founder asserted.

Hyperliquid strictly prohibits its employees and contractors from participating in derivatives trades involving HYPE, including activities like shorting or holding long positions on the token. Iliensinc added that trading based on "material non-public information" is strictly forbidden and that sharing such information with third parties is also not allowed.

HYPE Recognized as the “Best Story” by Arthur Hayes Despite Recent Price Drop

Founded in late 2022, Hyperliquid has quickly become a leader in the perpetual decentralized exchange (DEX) market. According to CoinGecko, the platform recorded a trading volume of at least $653 billion in the second quarter of 2025, capturing about 73% of the perp DEX market share.

CoinGecko’s Q2 2025 industry report. Source: CoinGecko

Notably, Arthur Hayes, co-founder of BitMEX and a pioneer in promoting perpetual contracts in the cryptocurrency space, recently mentioned Hyperliquid as the “best story” of the current market cycle. He noted that HYPE was launched at “two or three bucks” in November 2024 and surged to an impressive $60 shortly after.

While HYPE has faced considerable fluctuations in 2025, reaching an all-time high near $60 in mid-September, it was trading at approximately $25.40 at the time of publication. This represents a 24% decrease over the past year but an impressive 290% increase since its initial launch, as reported by CoinGecko.

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