Hyperliquid Labs addresses reports of North Korea-related activity on its protocol

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Hyperliquid, a leading on-chain perpetual income exchange, faced scrutiny after allegations surfaced of North Korean-linked wallet activity on its platform.

Security expert Taylor Monahan from MetaMask reported that wallets linked to North Korean hackers had traded ETH on Hyperliquid, resulting in over $700,000 in liquidation.

“DPRK does not trade. DPRK Trials,” Monahan posted on Xsuggesting that the wallets could check for platform vulnerabilities.

The allegations prompted many users to withdraw, with data from Hashed's Dune Analytics dashboard shows more than $194 million in USDC withdrawn on Monday.

Hyperliquid Labs denied the claims via statements on its Discord channel.

“Hyperliquid Labs is aware of reports circulating regarding activity with purported DPRK addresses,” the team said. “There has been no DPRK notification – or any notification for that matter – of Hyperliquid. An account of all user assets.”

The platform emphasized its strong operational security measures, including a generous bug bounty program and adherence to best practices in blockchain analytics.

Hyperliquid Labs also addressed claims of unprofessional interactions with an outside security consultant, saying the individual behaved unprofessionally, prompting the team to consult with a com -reliable partners in place.

After Hyperliquid Labs addressed the situation, the market reaction began to stabilize.

The dispute sparked a massive selloff in Hyperliquid's native token, HYPE, which fell more than 25% from a high of $34 on Sunday to a low of $25 on Monday.

However, the token has since bounced back and is currently trading at $27, according to DexScreener data.

Hyperliquid remains a major player in decentralized finance, commanding more than 55% of perpetual futures trading volume, according to data from the Dune dashboard of user uwusanauwu.

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