Hyperliquid Founder: Platform Puts Protocol Revenue over Falsehood, ADL Mechanism Makes Users Net Earn Hundreds of Millions of Dollars during Market Crash

BlockBeats News, October 19, Hyperliquid founder Jeff responded to the "Hyperliquid's Emphasis on Protocol Revenue over Traders' FUD": On October 10, Hyperliquid's Automatic Deleveraging (ADL) mechanism netted users hundreds of millions of dollars by liquidating profitable short positions at favorable prices. If more positions had been liquidated, HLP (Hyperliquid Protocol) could have earned hundreds of millions of dollars in additional revenue through profit and loss (PnL), but this would have exposed HLP to irresponsible high risk. ADL transferred HLP's potential PnL to users, while reducing HLP's risk exposure, achieving a win-win situation.

As a reminder, Hyperliquid's ADL queue has always employed a formula similar to most centralized exchanges (CEX), considering both leverage used and unrealized PnL. Finally, thank you all for the feedback on ADL; a simple mechanism is more robust and easier for users to understand. Nevertheless, Hyperliquid is exploring whether significant improvements can be introduced to demonstrate the value of increasing complexity.