After the recent ETH liquidation occurrence, which damaged hyperlicid’s hyperlicid’s hyperlicity provider vault $ 4 million, the forum stated that it would increase the maximum leverage allowed for bitcoin and atherium trading to prevent similar incidents in future.
In the incident of the said liquidity, a whale built a 50x leveraged long position on the atherium (Ath) that reached 160,234 ETH. However, when the market went against them, due to effective liquidation, the user was still able to withdraw 17.09 million USD coin (USDC), then exit in profit before the permission is executed on the hyperlicid platform.
The HLP vault, designed to act as a backstop, absorbed a loss of $ 4 million (about 1%of the $ 451 million vault TVL) from this liquidation. Hyperlicidity provider vault or HLP is like a shared pot of money, where people (or in USDC) accumulate funds (or their share (or loss in loss) from hyperlicid trading activities – for their stake – for their share.
Speculation stated that the user manipulated HLP for its benefit by returning the equity from HLP vault in a way that triggers the auto-locidation event with HLP, which was taking anti-trade position.
However, hyperlicid recently Addressed the incident on XThere was no exploitation or hack, assuring users. The platform claimed that their liquidation engine could not only handle the size of the user’s position. The forum also said that they will increase the Max Leverage and Etharium to 40x and 25x for Bitcoin (BTC) and atherium respectively to increase maintenance margin requirements for large positions.
