What To Know:
- Kyle Samani’s criticism of Hyperliquid sparked sharp backlash, with several crypto builders and investors defending the platform’s design choices and revenue-driven model.
- A Coinglass analysis comparing perp DEX metrics showed Hyperliquid displaying stronger consistency between volume, open interest, and liquidations than some rivals.
- The dispute has renewed a broader debate over how “real” trading activity should be measured in decentralized derivatives markets.
Hyperliquid is yet at the center of an intense debate after Kyle Samani, former co-founder of Multicoin Capital, accused the platform of working with closed-source code that could allow criminal misuse. His views quickly triggered reactions that divided the crypto industry across X, with developers, investors, and traders stepping in.
DBA co-founder Jon Charbonneau rejected Samani’s claims and argued that the criticism overstated potential risks. He wrote that many large financial systems are plagued by similar troubles, including banks and traditional blockchain networks. Charbonneau went on to say that some initiatives implement closed-source models to reconcile security interests and competitive interests in their initiation phase. According to him, the founders of Hyperliquid faced regulatory challenges that influenced their operational decisions.
Hyperliquid Yet Again in Controversy
Meanwhile, industry investor Andy from Good Idea VC focused on the platform’s broader economic design. He said Hyperliquid has pushed teams across the market to reconsider crypto structures and revenue models. He believes projects now face a lot of pressure to distribute value back to users through buybacks or other mechanisms tied to on-chain performance. He highlighted project revenue, measurable activity, and programmable cash flow as factors that increasingly shape investor confidence.
Hyper liquid is in most respects everything wrong with crypto
Founder literally fled his home country to build
Openly facilitates crime and terror
Closed source
Permissioned— Kyle Samani (@KyleSamani) February 8, 2026
Support for Hyperliquid also came from institutional observers. McKenna, managing partner at Arete.xyz, reported that traditional finance firms have begun tracking the platform’s growth. He described the project as a rare example of a small team which generates significant revenue while maintaining a strong community focus. According to McKenna, the platform’s reported revenue trajectory and buyback plans stand out even when compared with traditional equity markets.
The dispute escalated when Cobie, founder of echo xyz, publicly criticized Samani’s timing and tone. He mocked the comments and called them disconnected from current industry sentiment.
Moreover, a separate analysis by analytics platform Coinglass intensified the conversation. The firm compared perpetual decentralized exchanges and highlighted discrepancies in trading volumes, open interest, and liquidation levels among Hyperliquid, Aster, and Lighter. Hyperliquid recorded roughly $3.76 billion in trading volume, $4.05 billion in open interest, and nearly $123 million in liquidations. Aster and Lighter reported lower liquidation figures relative to their stated trading activity.
Coinglass argued that consistency across these metrics can indicate more organic trading behavior. The firm suggested that unusually high volumes paired with limited liquidations could emerge from incentive-driven trading or market-maker strategies. It determined that Hyperliquid’s internal data was more closely aligned, but some competitors needed more in-depth validation that included funding rates, fees, order-book depth, and active trader counts.
Critics have questioned this examination and cautioned that conclusions based on limited timeframes may cloud reality. They pointed to whale positioning, algorithmic differences, and structural differences among exchanges as other possible explanations for different patterns of liquidation between markets. Others pointed out that higher liquidations can also be an indication of aggressive leverage or volatile conditions rather than a healthier market environment.
Coinglass defended its report as the findings were based on publicly available data and were meant to encourage transparent discussion. The firm stressed that disputes should be resolved based on evidence and not personal attacks. Exchanges with higher leverage ceilings might also face more obvious shocks and larger liquidation swings, it added. But from a market performance viewpoint, the controversy seems to have had limited effect on Hyperliquid. HYPE was trading at $31.64, after dipping by 1.8% over the past hour.
Also Read: Ripple Prime Integrates Hyperliquid, $XRP Price Surged Briefly
