FX168 Financial News (Asia Pacific)'s on-chain tracking platform Spot On Chain showed that a smart money address deposited 5.22 million dollars into Hyperliquid to open a high-risk long position in Bitcoin and Ether. It has closed 2 long positions on Ether in the past two days, making a net profit of 2.2 million US dollars.

Spot On Chain wrote, “A smart/insider whale just deposited $5.22 million into Hyperliquid to place a high-risk long bet on Ether and Bitcoin.”

The deal includes:

1. Ethereum long (50x leverage): $1884.40 for entry, $1838.20 for liquidation

2. Bitcoin long position (20x leverage): $82003.90 for entry, $61,82 for liquidation

Notably, in the past two days, the giant whale quickly closed 2 ETH positions with a 100% win rate, making a net profit of $2.2 million.

(Source: Twitter)

On-chain analyst Ember later pointed out that the giant whale's high-risk long positions on Bitcoin and Ethereum have been closed, earning a total of 1.86 million dollars.

He wrote, “My 50x brother's 0.175 million Ether position on Hyperliquid has been closed, and today I earned another $1.86 million. My older brother transferred a total of 15.23 millionUSDC dollar stablecoins today. He just closed his position and withdrew 17.09 millionUSDC stablecoins, which means he earned 1.86 million by going long on Bitcoin and Ether today. He has recently earned $15.01 million by playing Bitcoin and Ethereum with 50x leverage.”

(Source: Twitter)

However, it is important to note that DLNews reported that investors in Hyperliquid's market maker tool lost 4 million dollars, raising concerns about the trading platform being used.

(Source: DL News)

The wallet address mentioned in the report starts with the characters 0xf3f4, that is, the giant whale that went 50 times longer on Ethereum mentioned above. It is the same trader.

The giant whale is betting $0.34 billion on the rise in the price of Ether and net an unrealized profit of about 8 million dollars. However, 0xf3f4 did not end the transaction; instead, the collateral was removed and the position closed.

Kasper Vandeloock, a cryptocurrency trader and consultant to several cryptocurrency trading platforms, said, “Due to the large scale of liquidation, Hyperliquid HLP took over the position at a price of $1,915 and is gradually closing the position. Currently, it is facing a floating loss of more than 4 million dollars.”

This is the biggest single day loss HLP Treasury has suffered since its launch in May 2023.

Hyperliquid stated on its official Twitter account: “There are no protocol breaches or hacking attacks, and HLP is not a risk-free strategy.”

Overall, HLP is generally aimed at ultra-liquid traders. In other words, as long as traders lose money overall, HLP investors will profit.

However, since some of HLP Treasury's strategies are automated, savvy traders may find a way to trick the treasury into making bad trades.

This appears to have happened when 0xf3f4 removed its collateral, forcing the HLP vault to take over the position.

Hyperliquid's HPE token fell about 12% as investors feared that the remaining $0.432 billion in the HLP vault was also at risk.