Papertrade faces allegations that two wallets used Hyperliquid trades worth around $20 million to move Ether prices while holding much larger positions on the platform. The claims rest on an X user's account and have not been independently verified. No verified loss figure or platform response accompanied the initial accusations.
Two wallets reportedly used trades worth around $20 million on Hyperliquid to move Ethereum prices by 0.1%–0.2% while holding positions worth hundreds of millions of dollars. The allegations target Papertrade, a decentralized trading platform. Neither the alleged manipulation nor any resulting losses have been independently verified.
Crypto trader Run reported the concerns on October 11 after X user Boblob claimed two wallets were exploiting a weakness in Papertrade's pricing system.
Boblob alleges two $20 million trades moved ETH
According to Boblob, the two wallets each executed trades worth approximately $20 million on Hyperliquid, briefly moving ETH prices by 10 to 20 basis points. The researcher also claimed the wallets simultaneously opened long positions on Papertrade with a combined nominal value reaching hundreds of millions of dollars.
Boblob alleged that the traders moved the reference price on Hyperliquid while keeping much larger positions on Papertrade. The researcher described Papertrade as "getting actively exploited by two wallets", but the report calls the statement an allegation.
Papertrade prices positions off the Hyperliquid midpoint
The allegations focus on Papertrade's choice to use the midpoint of Hyperliquid's best bid and best offer as its reference trading price. Papertrade's documentation says its smart contracts read that midpoint to set entry and exit prices, and the platform offers leverage of up to 1,000 times on supported markets, including Bitcoin and Ethereum.
Run argued this design creates a potential weakness because the best buying and selling prices can change as orders enter or leave the Hyperliquid order book. He pointed to Papertrade's published risk disclosures, which identify possible manipulation of the best bid and offer as an unresolved concern.
Still, a documented risk does not establish that a successful exploit has occurred or that users have suffered losses.
No verified loss figure or confirmed Papertrade response
The allegations do not establish that Hyperliquid's blockchain, native trading engine or oracle system was compromised. They concern Papertrade's own pricing design. Hyperliquid's documentation describes separate oracle and mark prices intended to reduce the effect of abnormal trading activity.
Reports circulating on October 11 have also not confirmed the amount of money allegedly extracted. The source reviewed identified no confirmed public response from Papertrade, and the platform has not announced a verified loss total, compensation arrangement or timetable for changing its pricing system.
Source: crypto.news
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