Bitcoin price is poised to hit $110,000 before retesting the $76,500 range

According to Arthur Hayes, Bitcoin price is poised to hit $110,000 before retesting the $76,500 range

The decentralized finance (DeFi) market saw interesting developments this week, with a crypto whale performing a "perfect" exploit on Hyperliquid to generate over $6 million in profit on a memecoin short position.

The unidentified whale, who is still holding nearly $2 million worth of the Jelly my Jelly (JELLY) token, managed to manipulate the price of the memecoin on the decentralized exchange.

According to a postmortem report by blockchain intelligence firm Arkham, the whale opened three large trading positions within five minutes: two long positions, one for $2.15 million and another for $1.9 million, and a $4.1 million short position that effectively offset the longs.

When the price of JELLY rose by 400%, the $4 million short position wasn't immediately liquidated due to its size. Instead, it was absorbed into the Hyperliquidity Provider Vault (HLP), which is designed to liquidate large positions.

The entity may still be holding nearly $2 million of the token's supply, according to blockchain investigator ZachXBT.

"Five addresses linked to the entity who manipulated JELLY on Hyperliquid still hold ~10% of the JELLY supply on Solana ($1.9M+). All JELLY was purchased since March 22, 2025," he said on March 26.

According to the report, the HLP absorbed the bulk of the long positions, liquidating them at a loss, while the short position remained open and continued to accrue losses as the price went up.

Ultimately, the short position was liquidated for a profit of $6.26 million, and the long positions were liquidated for a combined loss of $3.15 million.

This exploitation of Hyperliquid's algorithms and liquidation parameters resulted in a net profit of over $3 million for the unidentified whale.

"This is a perfect example of how DeFi protocols can be exploited when they are not programmed carefully enough to take into account potential abuse scenarios," the report concludes.

The exploitation sparked heated debate among industry members, with some highlighting the risks posed by this type of activity and others discussing the implications for the broader DeFi ecosystem.

"A single whale managed to rack up $6+ million in profit by exploiting Hyperliquid's algorithms and liquidation parameters. This is a perfect example of how DeFi protocols can be exploited when they are not programmed carefully enough to take into account potential abuse scenarios," the report concludes.

The exploitation sparked heated debate among industry members, highlighting the risks posed by this type of activity and discussing the implications for the broader DeFi ecosystem.