Hyperliquid’s Jeff Yan Says Exchanges Are Masking True Market Risk

Billions in Crypto Losses Reveal How Centralized Platforms Mislead Hyperliquid blockchain founder Jeff Yan has claimed that several major centralized exchanges (CEXs) are dramatically underreporting liquidation statistics by up to 100 times — to create a false sense of market stability. “Some CEXs publicly document that they dramatically underreport user ￰0￱ example on Binance, even if there are thousands of liquidation orders in the same second, only one is ￰1￱ liquidations happen in bursts, this could easily be 100x under-reporting under some conditions,” Yan ￰2￱ argues that the actual number of liquidations on CEXs far exceeds what is publicly reported, but verifying the truth is difficult because these platforms lack on-chain ￰3￱ emphasizes that Hyperliquid’s model is fundamentally different: every order, trade, and liquidation occurs on-chain, enabling anyone to audit the system in real time.

“On Hyperliquid, every order, trade, and liquidation is transparently verifiable ￰4￱ other venues significantly under-report liquidation data.” Yan also reiterated Hyperliquid’s philosophical stance, saying he hopes the industry will begin valuing transparency and neutrality as core features of the future financial ￰5￱ framed this not as mere ideology but as a competitive differentiator in an industry increasingly criticized for opaque practices. A Market Crash That Exposed Billions Yan’s remarks coincided with a dramatic market crash on October 10–11, 2025, when over $19 billion in futures positions were liquidated within a 24-hour ￰6￱ accounted for $10.3 billion of that total and recorded its largest single liquidation of over $203 ￰7￱ the upheaval, Yan pointed out that Hyperliquid’s fully on-chain recording prevents any possibility of data manipulation or ￰8￱ suggest such radical transparency might become a defining advantage for decentralized platforms over centralized exchanges that struggle with ￰9￱ crash’s fallout was severe: over 1,000 Hyperliquid users lost all their funds, totaling $1.23 billion in ￰10￱ them, 205 traders lost more than $1 million, and four major addresses lost between $13 million and $18 million each.