Crypto traders on Hyperliquid were left scrambling on Tuesday as a sudden traffic surge overwhelmed the trading platform’s servers, causing a 30-minute trading outage. This allowed the team, having quickly investigated, to confirm the issue was a result of heavy traffic and not a hack or an exploit.
Through their official Discord channel, Hyperliquid representatives communicated updates as the situation unfolded. They explained that the API servers failed to send orders to nodes because of unprecedented user demand.
The exchange updated its status page to classify the event as a “major outage.” Moreover, the team promised stronger system protections and enhanced monitoring to prevent similar incidents.
Luke Cannon, an active Hyperliquid community member, said on X that the API failures also affected the platform’s frontends. Additionally, BasedApp, a trading app built on Hyperliquid and backed by Delphi, Hashed, and Spartan, confirmed order placement on its platform suffered downtime. Consequently, price divergences emerged as many traders struggled to manage positions during the disruption.
Market Activity Remains Heavy
Despite the outage, trading activity on Hyperliquid was still functional. According to the data from Coinglass, Long Short Positions were at $10.26 billion, with the opening of shorts slightly leading at $5.33 billion against $4.93 billion in longs. Margins were at $999.08 million, with shorts accounting for $525.98 million versus $473.10 million for longs.
All losses amounted to $232.67 million, with losses to shorts being $336.48 million against profits to longs of $103.80 million. Funding fees stood at $69.41 million, with shorts paying $119.59 million and most of the longs trying to earn negative funding fees of $50.17 million.
Hyperliquid native token HYPE dropped 3.33% during the incident and is currently trading close to $43. With quick changes and better infrastructure, the exchange hopes to restore market confidence.
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