The liquidation was so large relative to the order book that Hyperliquid's auto-deleveraging mechanism activated, forcibly closing profitable short positions on the other side of the trade to prevent the system from accumulating bad debt. A highly leveraged long bet on the Solana-based memecoin Fartcoin imploded on the Hyperliquid exchange, triggering a 50 percent price crash and roughly $3 million in losses for the trader behind multiple wallets. On-chain data show two main wallets built…
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