Hyperliquid Loses $700K to North Korean Hackers

After a strong rally, Hyperliquid’s native token, HYPE, has dropped 20%, now trading at $26.54. The platform’s market cap also slid below $9 billion. Two major events caused this decline: a large sell-off by whale investor Laurent Zeimes and a cyberattack from North Korean state-sponsored hackers.

The first blow came when Laurent Zeimes, a major whale, sold over 1 million tokens. This sell-off caused panic in the market and led to a sharp decline in the price of HYPE.

Turns out, both factors played a part, but there’s more to the story. Read on to know what’s really at stake.

North Korean Hackers Disrupt Hyperliquid

The situation worsened when North Korean hackers turned their attention to Hyperliquid. Over the weekend, wallets linked to these hackers reportedly executed trades on the platform, resulting in losses of over $700,000.

Cybersecurity experts like Tayvano believe these trades were part of an effort to find weaknesses in Hyperliquid’s system. Despite the warnings, the platform’s team appears unconcerned, with Tayvano commenting,

“If I were managing Hyperliquid’s four validators, I’d be worried,”

North Korea’s Record-Breaking Year in Cybercrime

Notably, 2024 has been the most profitable year for North Korean hackers, with over $1.34 billion stolen across 47 cyberattacks, according to Chainalysis. This staggering figure accounts for 61% of the year’s total crypto theft, marking a 21% increase from 2023. Major heists include $305 million from DMM Bitcoin in May and $235 million from WazirX in July.

Most attacks result from private key compromises, which make up 44% of the total losses, underscoring the urgent need for stronger security measures. North Korea uses these illicit gains to fund its weapons programs, and experts warn that attacks are increasing in frequency and scope, now targeting smaller sums as well.

According to Lookonchain, the hackers went long on ETH as well at $3,791.8 but were liquidated when ETH’s price fell to $3,251.8, resulting in a $458K loss in just two days.

Pros and Cons Analysis

In a notable incident, hackers took long positions on ETH at $3,791.8 but were liquidated when ETH’s price dropped to $3,251.8, losing $458K in just two days, according to Lookonchain.

Despite these risks, crypto analyst Cygaar reassured the community, noting that if three of Hyperliquid’s four validators were compromised, attackers could potentially withdraw $2.3 billion in USDC. However, Cygaar pointed out that Hyperliquid has strong defenses in place, such as Circle freezing stolen funds and Arbitrum rolling back the chain to restore the bridge. While there are risks, Cygaar believes there is no immediate cause for panic.

• Also Read :
•   Crypto Hack Weekly Report: $2.2 Billion Stolen in 2024, Centralized Exchanges Hit Hard
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Hyperliquid’s Impressive Growth

Despite the challenges, Hyperliquid has become the largest on-chain trading platform, with 271,000 users, $12.14 billion in total deposits, and a daily trading volume of $6.20 billion. Its native token, HYPE, which launched on November 29, has surged from $1.97 to $27.97, now boasting a market cap of $9.35 billion, making it the 22nd largest cryptocurrency.

With North Korea’s increasing cyberattacks, it’s clear that these hackers are a significant threat to the global economy. The difficulty in preventing such thefts, combined with their ability to probe systems for vulnerabilities, could lead to more disruptions in the crypto market.

The crypto community will be closely watching how this situation unfolds.

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