Trading Bot Malfunction Causes Brief Price Fluctuations in HYPE and ZEC Markets

A trading bot malfunctioned on July 25, causing brief and sharp price fluctuations in HYPE and ZEC markets. The incident occurred when a certain bot account executed $27 million in round-trip trades on HYPE within 5 minutes, accounting for 74.2% of market trading volume. This sudden activity pushed the HYPE price to $60.96, while the external trading price was around $58 at the same time.

On ZEC, the bot created $220.8 million in taker volume, causing the price to briefly surge to $521. The risk engine used an anti-manipulation fair price to mark positions and rejected 801 orders due to insufficient margin. However, the bot ultimately lost about $482,000 (all self-funded).

The Lighter Liquidity Pool earned about $143,000, and 40 independent accounts each made more than $1,000 in profit from this incident. The bot account was started with $500,000 in funds, but its aggressive trading strategy backfired, resulting in significant losses.