Hyperliquid SK Hynix Perp Plunges 17.9% After Bad Price Print

A sudden price print of 1,272,000 won in Seoul caused the SK Hynix perpetual contract on Hyperliquid to plummet 17.9%, resulting in $57.4 million in liquidated long positions across 960 accounts.

The incident occurred due to a bad price print at NXT, a South Korean alternative stock venue that trades outside of Korea Exchange's hours. The abnormal pre-market order was not confirmed by either firm, but its impact on the market was significant.

The contract's oracle pulls prices from external venues while they are open, and in this case, it used the bad print as a reference. However, Trade.xyz, which operated the market under HIP-3 framework, had implemented discovery bounds to prevent extreme price movements. This cap held the drop to 17.9%, rather than the full 28.7% implied by the print.

The incident has raised questions about the design of the contract and the role of validators in cases like this. Trade.xyz must hold at least $27.4 million worth of HYPE tokens staked, which can be burned if a validator vote is passed. However, any compensation for traders would come from burning these tokens rather than distributing them to affected users.