Bitget CEO Gracy Chen has blasted Hyperliquid’s response to an incident that occurred on its perpetual exchange on March 26 and warned that it might turn into “FTX 2.0.”
On that day, Hyperliquid—a blockchain network focused on trading—delisted perpetual futures contracts for the JELLY token and promised user reimbursements after detecting “suspicious market activity.” However, the decision was made by a small group of validators, raising concerns about the network’s centralization.
“Hyperliquid presents itself as an innovative decentralized exchange, but it operates more like an offshore centralized exchange,” Chen remarked, reinforcing her claim that it could follow FTX’s path.
FTX, a crypto exchange led by Sam Bankman-Fried, collapsed in 2022, with its founder later convicted of fraud in the US. Chen labeled Hyperliquid’s handling of the event “immature, unethical, and unprofessional,” even if she did not charge it with legal transgressions.
She further criticized Hyperliquid’s decision to close the JELLY market and force settlements at favorable prices, warning that such actions damage trust, the foundation of any exchange.
https://twitter.com/GracyBitget/status/1904941729834557453
The JELLY Incident
JELLY, launched in January by Venmo co-founder Iqram Magdon-Ismail as part of the JellyJelly Web3 social project, initially reached a $250 million market cap before plummeting to single-digit millions, according to DexScreener.
On March 26, its market cap surged to $25 million after Binance introduced perpetual futures for the token. That same day, a trader on Hyperliquid allegedly opened a massive $6 million short position on JELLY and then manipulated the price to trigger self-liquidation, according to Abhi, founder of Web3 firm AP Collective.
