Update (Aug. 27 at 5:44 pm UTC): This article has been revised to indicate that a blockchain analyst has retracted a claim connecting Justin Sun to a whale wallet.
Four whales, or major cryptocurrency investors, have been accused of manipulating prices, leading to a $4.59 million loss for one unfortunate trader and raising concerns about the dependability of decentralized trading platforms compared to their centralized alternatives.
Four whale addresses collectively earned $47.5 million after the newly launched Plasma blockchain’s (XPL) token surged 200% to over $1.80 in moments on the decentralized exchange Hyperliquid.
The largest of the four, wallet 0xb9c, garnered more than $15 million as the “main orchestrator,” according to blockchain data platform Spot On Chain in a Wednesday X post, stating:
“Whale manipulation on #Hyperliquid propelled $XPL up 200% to $1.80 in mere moments today, marking one of the most extreme short squeezes and wealth redistributions we’ve witnessed!”
“In just a few months, Hyperliquid has experienced whales taking advantage of HLP vulnerabilities, manipulating coin prices, and sniping positions,” continued the post, calling for the decentralized trading platform to address the allegations.
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The nearly $48 million profit came at the cost of several other traders, with the most unfortunate experiencing a $4.5 million loss on an XPL position.
A second unfortunate trader, X user CBB, acknowledged losing $2.5 million on his XPL short position, stating that he is “never returning to isolated markets” again.
These manipulation claims surface five months after Hyperliquid faced a $6.26 million exploit involving the Jelly my Jelly (JELLY) memecoin due to a flaw in its liquidation parameters, Cointelegraph reported in March.
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Onchain investigator retracts claim linking Justin Sun to whale wallet
An onchain investigator initially pointed to Tron Network founder Justin Sun as a possible trader behind one of the whale wallets but later retracted the assertion, calling it incorrect.
“After verifying with multiple sources, I can confirm this is not Justin Sun. I apologize for the earlier erroneous analysis. More information will follow,” pseudonymous analyst MLM stated on X.
The wallet in question began long positions on millions of XPL tokens on Hyperliquid, ‘clearing the entire order book and liquidating everyone,’ MLM said Wednesday. After closing the positions, the whale made $16 million in “just one minute.”
$XPL surged to $1.80, which is over 200% in 2 minutes.”
The address continues to hold a 1x leveraged XPL position valued over $8.6 million, with an unrealized profit of over $614,000, according to Hypurrscan blockchain data.
Cointelegraph has been unable to independently verify the ownership of the wallet address but has reached out to Justin Sun and Hyperliquid for comments.
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