Hyperliquid Founder Calls Out Binance and CEXs for Hiding Liquidation Data Amid Market Crashes

The post Hyperliquid Founder Calls Out Binance and CEXs for Hiding Liquidation Data Amid Market Crashes appeared first on Coinpedia Fintech News

Hyperliquid founder Jeff Yan has recently criticized the lack of transparency around centralized exchange (CEX) liquidation reporting, contrasting it with Hyperliquid’s model.

These remarks come after one of the largest liquidation events in crypto history, which affected over 1.6 million traders. The incident has sparked a broader conversation about fairness and accountability in crypto trading.

The Transparency Gap in Centralized Exchanges

Yan pointed out that the difference between centralized and decentralized systems is significant.

He said some CEXs openly admit to dramatically underreporting user liquidations. He cited Binance’s example saying, even if thousands of liquidation orders occur in the same second, only one might be actually reported. As these liquidations often happen in bursts, he notes that this can lead to underreporting by 100x easily in certain conditions. 

He hopes that the industry sees transparency and neutrality as key parts of the new financial system, and encouraged others to follow Hyperliquid’s lead. 

Hyperliquid’s Transparent Approach

“Hyperliquid’s fully onchain liquidations cannot be compared with underreported CEX liquidations,” Yan said. 

Hyperliquid is a blockchain where every order, trade and liquidation happens fully onchain. Anyone can verify how the chain executes, confirm every liquidation and even check the solvency of the entire system in real time. 

Yan believes that transparency and neutrality are what make decentralized finance (DeFi) the right foundation for the future of global finance.

Community Calls for Stronger Protections

One trader suggested that exchanges should add a type of false wick liquidation protection to better safeguard users. They praised Hyperliquid’s transparent system but said additional protections are needed to prevent traders from suffering unexpected losses during volatile periods.

Community members also urged users to move away from CEXs and called for more transparency and honesty in financial systems.

Notably, Coinglass also praised Hyperliquid for improving transparency in industry data and expressed hope that other platforms and institutions will follow their example.

Thanks to Hyperliquid for contributing to greater transparency in the industry’s data — hopefully other institutions will follow suit.