Hyperliquid exploit drained $782K from its Hyperdrive lending pools, once again spotlighting vulnerabilities in the ecosystem. Still, the frenzy around the Hypurr NFT launch on HyperEVM stole headlines, racking up $45M in trade volume within hours and fueling a mix of concern and excitement in the community.
Key Insights
- A Hyperliquid exploit recently drained $782,000 from Hyperdrive’s lending pools due to a smart contract vulnerability.
- Hyperliquid launched 4,600 Hypurr NFTs on HyperEVM and created $45 million in early trade volume.
- Meanwhile, the network continues to face ongoing stability questions after the kHYPE peg issues and an upcoming $12 billion token unlock.
The recent Hyperliquid hack has raised worries about security in the blockchain space. On September 28, Hyperdrive (a lending protocol built on Hyperliquid) lost around $782,000 in a smart contract hack.
The incident came just as the network rolled out its Hypurr NFT collection on the HyperEVM mainnet.
Hyperliquid Exploit Hits Hyperdrive Lending Pools
The Hyperliquid exploit targeted two Hyperdrive markets, and drained approximately 673,000 USDT0 and 110,244 thBILL tokens, worth about $782,000 combined.
Blockchain security firm Certik reported that the attacker repeatedly abused an arbitrary call in Hyperdrive’s router smart contract to drain funds.
The stolen assets were converted into cross-chain tokens like BNB and ETH before being moved off-chain.
Hyperdrive responded by pausing its protocol to prevent further damage. The team announced that the root cause had been identified and patched and promised to share a full postmortem along with a compensation plan soon.
Security Incidents Show Hyperliquid’s Pains
This is the third major security incident in the Hyperliquid ecosystem since its launch late last year.
In March, a whale manipulated the on-chain price of Solana-based memecoin JELLYJELLY and forced a protocol loss of $12 million. Another incident involved whale-driven vault manipulation that cost $4 million.
Despite these setbacks, Hyperdrive still holds about $21 million in total value locked, according to DefiLlama.
The series of hacks has raised issues about how robust the platform’s smart contracts are, as it competes in a crowded DeFi market.
Hypurr NFT Launch And Community Attention
While the Hyperliquid exploit has damaged sentiment, the network’s Hypurr NFT launch on September 29 provided a different headline.
The collection, which was minted on HyperEVM, featured 4,600 NFTs distributed to early adopters, contributors and the Hyper Foundation.
According to OpenSea data, the Hypurr collection recorded roughly 952,000 HYPE in trade volume. This is equal to about $45 million, within hours of launch. The floor price surged to around $68,900 with Hypurr #21 fetching 9,999 HYPE or nearly $470,000.
Mixed Market Reaction and Ongoing Stability Concerns
Despite the strong launch of Hypurr NFTs, Hyperliquid’s native HYPE token saw only modest gains and rose 4.65% to $47.14 in the past 24 hours. Analysts are still wary of its general stability risks.
Blockchain investigator ZachXBT reported that a single bad actor stole eight Hypurr NFTs from compromised wallets soon after launch. Wven worse, the attacker profited about $400,000 from this.
Other issues include the upcoming $12 billion unlock of HYPE tokens and the recent instability of kHYPE, which briefly fell to 0.8802 against WHYPE before recovering.
Ecosystem Expansion Aims to Build Trust
Hyperliquid’s leadership is pushing ahead with expanding its ecosystem and rebuilding confidence. The network’s new permissionless spot quote feature allows stable asset deployers to activate quote status under on-chain rules.
USDH, Hyperliquid’s native stablecoin, which is backed by cash and US Treasuries, became the first permissionless quote asset. This move is expected to improve liquidity and strengthen the platform in terms of competitiveness.
Overall, the Hyperliquid exploit has shown the need for stronger safeguards as the network scales its offerings.
While the Hypurr NFT launch boosted community engagement and generated strong trade volume, there are still a few ulnerabilities and market risks to iron out.
Overall, Hyperliquid’s focus on stablecoin-backed liquidity and other features initiatives shows ambition. However, long-term adoption will depend on how the platform addresses its ongoing challenges.
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