Crash

Founder

Jeff

Hyperliquid

<p>Hyperliquid founder Jeff Yan has recently <a href="https://x.com/chameleon_jeff/status/1977578610329534958" target="_blank" rel="noopener noreferrer nofollow">criticized </a>the lack of transparency around <a href="https://coinpedia.org/exchange/" target="_blank" rel="noopener noreferrer nofollow">centralized exchange</a> (CEX) liquidation reporting, contrasting it with Hyperliquid’s model.</p>
<p>These remarks come after one of the largest liquidation events in crypto history, which affected over 1.6 million traders. The incident has sparked a broader conversation about fairness and accountability in crypto trading.</p>
<h2 class="wp-block-heading" id="h-the-transparency-gap-in-centralized-exchanges">The Transparency Gap in Centralized Exchanges</h2>
<p>Yan pointed out that the difference between centralized and decentralized systems is significant.</p>
<p>He said some CEXs openly admit to dramatically underreporting user liquidations. He cited Binance’s example saying, even if thousands of liquidation orders occur in the same second, only one might be actually reported. As these liquidations often happen in bursts, he notes that this can lead to underreporting by 100x easily in certain conditions.&nbsp;</p>
<p>He hopes that the industry sees transparency and neutrality as key parts of the new financial system, and encouraged others to follow Hyperliquid’s lead.&nbsp;</p>
<h3 class="wp-block-heading" id="h-hyperliquid-s-transparent-approach">Hyperliquid’s Transparent Approach</h3>
<blockquote class="wp-block-quote is-layout-flow wp-block-quote-is-layout-flow">
 <p>“Hyperliquid’s fully onchain liquidations cannot be compared with underreported CEX liquidations,” Yan said.&nbsp;</p>
</blockquote>
<p>Hyperliquid is a blockchain where every order, trade and liquidation happens fully onchain. Anyone can verify how the chain executes, confirm every liquidation and even check the solvency of the entire system in real time.&nbsp;</p>
<p>Yan believes that transparency and neutrality are what make decentralized finance (DeFi) the right foundation for the future of global finance.</p>
<h2 class="wp-block-heading" id="h-community-calls-for-stronger-protections">Community Calls for Stronger Protections</h2>
<p>One <a href="https://x.com/TheWhiteWhaleV2/status/1977591673598181594" target="_blank" rel="noopener noreferrer nofollow">trader </a>suggested that exchanges should add a type of false wick liquidation protection to better safeguard users. They praised Hyperliquid’s transparent system but said additional protections are needed to prevent traders from suffering unexpected losses during volatile periods.</p>
<p><a href="https://x.com/smartestmoney_/status/1977582356832944538" target="_blank" rel="noopener noreferrer nofollow">Community members also</a> urged users to move away from CEXs and called for more transparency and honesty in financial systems.</p>
<p>Notably, Coinglass also praised Hyperliquid for improving transparency in industry data and expressed hope that other platforms and institutions will follow their example.</p>
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   <p>Thanks to Hyperliquid for contributing to greater transparency in the industry’s data — hopefully other institutions will follow suit.🫡🫡🫡 <a href="https://t.co/QZ7mewCOFm" rel="noopener noreferrer nofollow">https://t.co/QZ7mewCOFm</a></p>— CoinGlass (@coinglass_com) <a href="https://twitter.com/coinglass_com/status/1977581674373460220?ref_src=twsrc%5Etfw" rel="noopener noreferrer nofollow">October 13, 2025</a>
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<h3 class="wp-block-heading" id="h-cz-pushes-back">CZ Pushes Back</h3>
<p>Binance founder Changpeng Zhao (CZ) responded indirectly to Yan’s comments.</p>
<blockquote class="wp-block-quote is-layout-flow wp-block-quote-is-layout-flow">
 <p><em>“Some people ask why BNB is so strong. While others tried to ignore, hide, shift blame, or attack competitors, the key @BNBChain ecosystem players (Binance, Venus, and more) put hundreds of millions of their own money on the line to protect users,”</em> he said.&nbsp;</p>
</blockquote>
<p>He ended his post by saying<em> “different value systems,” </em>which many saw as a quiet dig at Hyperliquid.</p>
<figure class="wp-block-embed is-type-rich is-provider-twitter wp-block-embed-twitter">
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   <p>Some people ask why is <a href="https://twitter.com/hashtag/BNB?src=hash&amp;ref_src=twsrc%5Etfw" rel="noopener noreferrer nofollow">#BNB</a> so strong?<br><br>While others tried to ignore, hide, shift blame, or attack competitors, the key <a href="https://twitter.com/BNBCHAIN?ref_src=twsrc%5Etfw" rel="noopener noreferrer nofollow">@BNBChain</a> ecosystem players (Binance, Venus, and more) took hundreds of millions out of their own pockets to PROTECT USERS.<br><br>Different value systems. 💪 <a href="https://t.co/zb0UIBfcBn" rel="noopener noreferrer nofollow">https://t.co/zb0UIBfcBn</a></p>— CZ 🔶 BNB (@cz_binance) <a href="https://twitter.com/cz_binance/status/1977583589677310392?ref_src=twsrc%5Etfw" rel="noopener noreferrer nofollow">October 13, 2025</a>
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<h3 class="wp-block-heading" id="h-market-crash-tests-platforms-strength-nbsp">Market Crash Tests Platforms’ Strength&nbsp;</h3>
<p>The discussion followed a major <a href="https://coinpedia.org/news/crypto-liquidation-hits-19b-as-trumps-china-tariff-triggers-market-crash/" target="_blank" rel="noopener noreferrer nofollow">market crash that shook the crypto sector</a>. Over 1.6 million traders were liquidated, resulting in a $19B wipeout. During this period, Hyperliquid recorded the highest liquidation volume at $10.31 billion, followed by Bybit and Binance.&nbsp;</p>
<p>Despite extreme volatility, Hyperliquid maintained 100% uptime and reported zero bad debt, highlighting the strength of its on-chain infrastructure.</p>
<h3 class="wp-block-heading" id="h-transparency-is-now-essential">Transparency Is Now Essential</h3>
<p>This critique highlights how transparency and accountability cannot be optional.&nbsp;</p>
<p>On DeFi platforms like Hyperliquid, every trade, liquidation, and position is publicly visible on-chain, giving traders a clear, real-time view of the market. Centralized exchanges, however, reportedly keep much of this data hidden, leaving traders in the dark at critical times.&nbsp;</p>
<p>Experts are now calling for clearer rules and better accountability, urging all exchanges to provide transparent, verifiable data to protect traders.</p>
<h2 class="wp-block-heading" id="h-faqs">FAQs</h2>
<div class="schema-faq wp-block-yoast-faq-block">
 <div class="schema-faq-section" id="faq-question-1760354875565">
  <strong><strong>What is the problem with liquidation reporting on centralized exchanges?</strong></strong>
  <p>Critics allege some major CEXs dramatically underreport liquidations, sometimes by 100x, by counting burst liquidations as a single event, hiding true market risk.</p>
 </div>
 <div class="schema-faq-section" id="faq-question-1760354905266">
  <strong><strong>Which exchange had the most liquidations during the recent market crash?</strong></strong>
  <p>During the major crash, Hyperliquid had the highest liquidation volume at over $10B, but highlighted its 100% uptime and zero bad debt due to its on-chain model.</p>
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</div>

Hyperliquid Founder Calls Out Binance and CEXs for Hiding Liquidation Data Amid Market Crashes

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