Unknown Attackers Target Hyperliquid Vault via FARTCOIN Pump

On April 9, the decentralized exchange Hyperliquid experienced a significant security breach as four wallets artificially inflated the FARTCOIN token through extensive long positions, leading to a cascade of liquidations that cost the platform approximately $1.5 million.

According to PeckShield, the attackers amassed long positions valued at $15 million, equivalent to 145.24 million FARTCOIN, across multiple wallets. This manipulation resulted in a temporary price surge of 25%, pushing the token from $0.20 to $0.25.

Once the price had been artificially raised, the attacker executed what is termed a "suicide" liquidation in a low liquidity environment. This triggered the Automatic Deleveraging (ADL) mechanism, forcing the Hyperliquid vault (HLP) to absorb the losses from the liquidated positions.

Despite incurring a theoretical loss of around $3 million, analysts believe the attackers likely offset their losses by hedging on other platforms. Following the incident, FARTCOIN's value plummeted to $0.19, reflecting a 7% decrease within 24 hours.

Recurring Issues for Hyperliquid Vault

This incident marks yet another attack on Hyperliquid's vault. In March 2025, the platform suffered a $4 million loss due to speculative activities involving Ethereum, where a trader leveraged a long position on 175,000 ETH, triggering a series of liquidations.

Additionally, a similar event occurred with the JELLYJELLY token, where an investor executed long positions of $2.15 million and $1.9 million while hedging with a $4.1 million short position. The resulting price spike of nearly 400% led to the liquidation of the short, transferring assets to HLP and prompting the exchange to halt trading on that contract. The user managed to withdraw approximately $6.2 million during the chaos.

Experts from 10x Research have pointed out that the transparency of Hyperliquid has enabled a "public hunt" for leveraged traders, highlighting ongoing vulnerabilities that could be exploited in the future.