Hyperliquid Clarifies HYPE Token Shorting By Ex-Employee

Decentralized perpetuals exchange Hyperliquid has addressed community concerns about a wallet that was believed to be linked to the internal team selling large amounts of HYPE (HYPE).

Co-founder Iliensinc said on Hyperliquid’s Discord channel Monday that the wallet flagged by the community for shorting HYPE belongs to an ex-employee who was terminated in the first quarter of 2024.

“This individual is no longer associated with Hyperliquid Labs, and their actions do not reflect our team’s standards or values,” Iliensinc wrote, referring to the address 0x7ae4…1028.

The clarification followed weeks after community member cobe.hype claimed the address belonged to “one of the Hyperliquid team wallets” that sold about 4,000 HYPE tokens ($134,000) in a single day in November.

Employees and contractors are bound by “strict ethical standards”

In the Discord post, Iliensinc said that Hyperliquid Labs maintains a strict trading policy designed to ensure that its team operates with a “level of accountability that sets a benchmark for the industry.”

“All individuals associated with Hyperliquid Labs, including employees and contractors, are bound by strict ethical standards regarding the HYPE token,” the co-founder wrote.

Hyperliquid specifically prohibits employees and contractors from derivatives trading involving HYPE, which includes shorting or going long on the token, Iliensinc wrote.

The co-founder added that trading based on “material non-public information” is “fundamentally prohibited,” and that the restriction extends to sharing such information with third parties.

HYPE dubbed “best story” this cycle by Arthur Hayes, despite 24% drop this year

Founded in late 2022, Hyperliquid has grown to command a dominant share of the perp DEX market.

The platform handled at least $653 billion in trading volume in Q2, 2025, representing roughly 73% of the perp DEX market, according to CoinGecko.

Arthur Hayes, who co-founded BitMEX and helped popularize perpetual contracts in crypto, recently described Hyperliquid as the “best story” of this cycle so far. He noted that HYPE launched at “two or three bucks” in November 2024 before “ripping all the way to $60.”

HYPE has experienced notable volatility in 2025, hitting an all-time high near $60 in mid-September before subsequent sell-offs. At the time of publication, HYPE was trading at $25.40, down about 24% over the past year but up about 290% since launch, according to CoinGecko.