Trade.xyz said it will cover liquidation losses linked to the sudden collapse of its SK Hynix perpetual contract on July 27, following an incident that affected nearly 1,000 leveraged positions on Hyperliquid.
Recall that the other day, the mark price for the stock dropped from $1,127.90 to $917.25. The move triggered a massive liquidation cascade, which caused about $57 million in liquidations with about $17.3 million in realized losses, according to preliminary analysis.
The team behind the Hyperliquid HIP-3 operator said the price originated from an executed transaction carried by several independent data providers. Its oracle was tracking an external venue responsible for the trade, which the platform described as the main Korean pre-market venue.
According to them, the oracle operated according to its existing specifications. However, the resulting mark price caused liquidations before the underlying market recovered from the isolated print.
On July 27 at 23:01 UTC, SKHYNIX mark price dropped from $1,127.9 to $917.25. This print was based on an executed trade which was relayed by multiple independent data providers. The XYZ oracle was live in external pricing and tracking that venue, which serves as the primary…
— trade.xyz (@tradexyz) July 29, 2026
Trade.xyz outlined that they will reimburse liquidation losses attributable to the anomaly. The platform will announce eligibility requirements soon and expects to complete distributions within the coming days.
The company also described the compensation as a one-time discretionary measure. It stressed that the decision does not guarantee reimbursements following similar incidents in the future.
The announcement also addressed the immediate financial impact on traders but doesn’t change how leveraged positions were automatically closed when the oracle price fell.
In addition, the firm also plans to strengthen its pricing systems against similar tail events. The review will scope the platform’s reliance on external venues and the assumptions used when constructing mark prices.
The team said they will also consider giving more weight to activity on its own order books.
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