TechFlow news, on March 13, Bybit CEO Ben Zhou posted on X analyzing that the recent large-scale liquidation of a whale's ETH position on Hyperliquid was actually a deliberate use of the liquidation mechanism to exit the market. The trader held an approximately $300 million long ETH position (with around $15 million in margin) at 50x leverage and triggered liquidation by withdrawing unrealized profits, thereby pushing up the liquidation price. After liquidation was triggered, the entire position was handed over to the platform for execution, avoiding significant slippage from market orders.
Ben Zhou pointed out that both DEXs and CEXs face similar challenges. In response, Hyperliquid has reduced its overall leverage limits (Bitcoin down to 40x, Ethereum down to 25x). He suggested that DEXs could consider implementing dynamic risk-limiting mechanisms—gradually reducing leverage as positions grow larger—or introducing centralized exchange-level risk controls such as market surveillance and open interest caps.
Ben Zhou stated that even with the current reduced leverage levels, Hyperliquid could still be exploited unless further leverage reductions or stricter risk controls are implemented.
