Hyperliquid Defends Transparency After Record $20B Market Liquidations

Hyperliquid founder Jeff Yan has strongly defended the decentralized exchange (DEX) amid criticism following last Friday’s massive crypto market crash. Yan emphasized that Hyperliquid’s fully on-chain liquidation system offers complete transparency, setting it apart from centralized exchanges (CEXs) like Binance, Coinbase, and Kraken, which reportedly underreported liquidations by nearly 100 times during the crash.

As major platforms faced severe congestion and downtime, Hyperliquid maintained zero downtime and seamless trading operations. Yan stated that every order, trade, and liquidation on Hyperliquid is recorded directly on-chain, enabling anyone to verify transactions and assess the platform’s solvency in real time. He underscored that transparency and neutrality are essential to building a reliable financial infrastructure, arguing that on-chain DeFi provides unmatched openness compared to centralized models.

In contrast, Yan criticized CEXs for masking the extent of their liquidations during volatile periods. “Even if thousands of liquidation orders occur simultaneously, only one might be reported,” he said, calling such practices misleading and harmful to user trust.

Last Friday’s crash triggered an unprecedented $20 billion in liquidations, with Hyperliquid leading the market at $10.31 billion, followed by Bybit at $4.65 billion and Binance at $2.41 billion. The event has sparked debate over risk management, transparency, and systemic stability across the crypto ecosystem.

Crypto.com’s CEO has since called for global regulatory investigations into both centralized and decentralized exchanges following the crash. In response to criticism, Yan stated, “Solvency and uptime are non-negotiable. It’s unethical to gaslight users to hide systemic flaws.”

As markets rebounded this week, Bitcoin regained the $115,000 level, while Ethereum and altcoins showed strong recovery. Binance also announced $283 million in user compensation for losses caused by last week’s disruptions.