Haciyev Reşit 
POPCAT experienced a sharp collapse following a major manipulation event on the Hyperliquid exchange. A single trader’s highly leveraged positions triggered a $30 million liquidation cascade, disrupting both POPCAT’s price and Hyperliquid’s liquidity mechanism. Immediately after the incident, POPCAT dropped 25%, falling from $0.20 to $0.12. The exchange’s liquidity pool (HLP) also suffered an estimated $5 million loss.
The Setup Behind the Manipulation
The sequence began when an unknown investor withdrew around $3 million in USDC from OKX. These funds were then distributed across 19 separate wallets on Hyperliquid. The trader opened massive 10× leveraged long positions on POPCAT, pushing total exposure to $30 million. As leverage amplified the upward movement, the sudden price climb caught other traders’ attention.
This artificial pump wasn’t limited to Hyperliquid. The same trader allegedly placed $20–$30 million worth of buy orders around the $0.21 level on multiple global exchanges. This created the illusion of genuine market demand, tricking other investors into buying — a classic orchestrated manipulation strategy.
Triggering the Collapse
As momentum built, retail traders rushed in. The critical moment came when the whale cancelled all spoofed buy orders at once. The sudden disappearance of buy support left the market exposed, causing POPCAT to crash nearly 25% within minutes. In the last 24 hours, approximately $65 million in liquidations occurred the majority coming from long positions. This liquidation cascade accelerated the drop from $0.20 to $0.12. The manipulator lost their entire $3 million collateral.
Hyperliquid’s liquidity pool (HLP) had to absorb $26–$28 million of the whale’s failing positions to prevent a deeper systemic collapse, resulting in $4.9 million in losses for the pool.
Exchange Response & Damage Control
Following the market chaos, the Hyperliquid team implemented emergency measures:
- Remaining high-risk positions were manually closed
- The Arbitrum bridge was temporarily paused to stabilize liquidity flows
- Deposits and withdrawals remained open, but concerns grew about possible structural weaknesses within Hyperliquid’s liquidity model
Some analysts believe this was a high-risk trade gone wrong, while others suspect a deliberate stress test or an attempt to exploit weaknesses in the exchange’s liquidity engine. It also marks the third major disruption Hyperliquid faced in 2025.
Market Reaction
The event highlights how vulnerable small and mid-cap meme coins are to extreme volatility. Analysts warn that if the current support zone breaks, POPCAT faces a high probability of dropping below $0.10. Overall, the POPCAT incident underscores a critical reality in DeFi: Liquidity remains extremely fragile and highly susceptible to manipulative behavior, posing serious risks for traders and protocols alike.
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