XPL Soars 200% After Shocking Whale Move Rocks Hyperliquid

Key Points

• XPL Soars 200% After Whale Move on Hyperliquid Shocks Market
• The move wiped out shorts and cleared the Hyperliquid order book
• HLP vault gained $47,000 but faced flashbacks of the previous $12M loss
• Speculation rises that Tron founder Justin Sun is behind the trade

The crypto world witnessed one of its wildest price moves this week as XPL soared 200% in just a few minutes on Hyperliquid.

At the heart of the action? A whale wallet that dropped $16 million USDC and opened aggressive long positions on XPL, catching the market completely off guard.

The result: chaos.

This one-sided move instantly cleared the order book, liquidated nearly every short position, and sent XPL’s price from $0.58 to $1.80—a dramatic 200% spike.

According to on-chain tracker Lookonchain, the wallet partially exited its position within the first minute, locking in $16 million in profit. But here’s the twist: this whale still holds 15.2 million XPL, worth over $10 million, keeping everyone guessing: is this just the beginning?

Whale 0xb9c0 deposited 16M $USDC into #Hyperliquid and opened a massive long on $XPL, sending the price soaring to $1.8 and liquidating everyone.

He then closed his position and made a profit of over $14M in less than an hour!https://t.co/rBQtbCLtbX pic.twitter.com/LC4evRWkhv

— Lookonchain (@lookonchain) August 27, 2025

The crypto community quickly pointed fingers. Many suspect the wallet could belong to Justin Sun, the controversial founder of Tron, known for bold market moves. While there’s no confirmed link, one X user summarized the situation best:

“Justin Sun just locked in $16M profit in under 60 seconds… easily one of the craziest liquidation cascades ever seen on Hyperliquid.”

Justin Sun just locked in $16M profit in under 60 seconds

He longed millions of $XPL, nuking the entire order book and wiping traders instantly. Sent $XPL soaring to $1.80 (+200% in 2 minutes)

And he’s STILL holding 15.2M $XPL ($10.2M) long.
Easily one of the craziest… pic.twitter.com/8QKiWFaKgT

— Nonzee (@0xNonceSense) August 26, 2025

The liquidation event highlights the vulnerability of decentralized exchanges (DEXs) like Hyperliquid when faced with low liquidity. In such environments, large orders can sweep through the order book, triggering liquidation cascades that leave most traders stunned and wrecked.

Events like this echo other volatile moments in DeFi history, such as the SAROS token crash or the recent YZY Token scam involving Hayden Davis, where sudden, unanticipated moves blindsided users.

HLP Vaults Profit, But Not Without Risks

While retail traders suffered, Hyperliquid’s HLP vault earned around $47,000 in fees during the XPL volatility spike. However, this story isn’t as positive as it seems.

Source: MLM on X

Flashback to a recent event involving the JELLY token, where similar volatility cost the vault nearly $12 million. The problem? Thin liquidity means that any large order can distort prices and wreck the vault’s positions, even as fees accumulate.

This wallet, presumed to be associated with Justin Sun, just longed millions of $XPL on Hyperliquid, clearing the entire order book and liquidating everyone.

He then started closing his long, making $16M in just one minute. $XPL pumped to $1.80, which is over 200% in 2 minutes… pic.twitter.com/o1x1AdCLeE

— MLM (@mlmabc) August 26, 2025

Hyperliquid had responded to the JELLY incident by refunding affected users and tightening its risk protocols. But the XPL episode proves that the underlying problem remains: large trades in thin books equal danger.

This incident serves as a wake-up call for those participating in liquidity vaults. While short-term profits like the $47K fee gain might seem attractive, they often come with significant downside risks, especially in highly volatile, thinly traded assets.

For average investors, the lesson is clear:

• Avoid high leverage in low-liquidity markets. A single whale can wipe you out in seconds.

• Always check the depth of the order book before entering any trade. Shallow books are risky hunting grounds for big players.

• Vault participation isn’t passive income. Yes, fees come in, but so do unexpected losses when things go south.

These events raise wider concerns about how easily whales can influence decentralized markets, an issue also discussed in cases like the $100M BNB investment reshaping DeFi dynamics.

Retail Traders Need Better Risk Education

What the XPL surge exposed wasn’t just market fragility; it highlighted how underprepared many retail traders are when dealing with whale activity and thin liquidity.

On-chain data shows that hundreds of traders were liquidated within seconds of the whale’s long order. Many used 10x or even 20x leverage, without checking the order book depth or recognizing early warning signs. The result? Sudden portfolio wipeouts.

Source: Hyperliquid

This brings attention to a growing problem in the DeFi space: the lack of real-time risk awareness tools and trader education.

Unlike centralized platforms, decentralized trading doesn’t always come with built-in alerts, auto-deleveraging systems, or circuit breakers. That makes it critical for traders to educate themselves about:

• How order books work on-chain

• How quickly liquidity dries up in smaller tokens

• How whales use momentum and leverage to trap retail

Additionally, trading communities and influencers often glorify quick wins without discussing the losses. The XPL pump is now trending across crypto Twitter, but little is said about the liquidations behind the scenes.

It’s also worth noting how identity, trust, and market manipulation intersect. The XRPL identity protocol leak revealed just how much influence powerful insiders can hold over token ecosystems, further emphasizing the need for transparency and user protection.

Moving forward, if platforms like Hyperliquid want to maintain trust, they must consider integrating educational dashboards, real-time liquidity warnings, and whale monitoring tools to protect inexperienced users.

As broader macro factors like US debt and crypto market impact continue to stir volatility, traders will need better strategies and tools to stay ahead of sudden price shocks.

For now, the XPL episode will remain a cautionary tale, one that shows just how fast profits can flip into pain in the wild west of DeFi trading.