Hyperliquid traders stuck in their positions as API suffered short outage

The Hyperliquid API is experiencing an outage, not allowing traders to close their positions. The event also means traders cannot close their positions and must wait for the service to return. 

Trading has stalled on the Hyperliquid perpetual futures DEX, as traders were unable to close their positions. The DEX experienced an outage of its API, meaning traders could not interact with the chain. Based on user reports, the outage persisted between 14:20 and 14:47 UTC. 

Just before the outage, some of the funding rates on Hyperliquid went negative. Speculations appeared of a coordinated attack or some other form of deliberate outage. 

During the outage, open positions could not be liquidated, leaving all users stuck with their positions until the issue is resolved. The event happened as Hyperliquid was carrying a record open interest of over $14.7B. The community still awaits a breakdown of the event, as the sudden outage sparked fears of a scenario similar to the inaccessible FTX trading just before the exchange crashed. The API crash also affected the Lighter DEX, which depends on Hyperliquid’s order books. 

Hyperliquid outage strikes as crypto assets turn the trend

Users are reporting outages on both mobile and PC, and are completely locked out of interactions with the protocol. Users on Discord also reported getting error messages, unable to control their DEX accounts. The problem may affect the entire DEX, with no possible orders or actions available for all users. Users reported that even stop losses were impossible, potentially wiping out value from user wallets.

getting error messages on hyperliquid on laptop and on mobile.

can’t close positions, can’t add margin. can’t cancel orders.

can’t establish a connection on mobile

i’m freaking out. anyone know what to do? help@HyperliquidX pic.twitter.com/eIQSMCJYHi

— kismet (@kismet_wtf) July 29, 2025

Despite the downtime, Hyperchain was operational and continued to produce blocks. Currently, Hyperliquid settles positions on-chain every hour, and it remains to be seen what happens with short and long positions as traders are unable to close them. Potentially, a significant number of positions were at risk of liquidation, causing chaos on the market. 

The Hyperliquid outage arrived as BTC shifted direction, sinking under $118,000. A downturn would liquidate some of the open positions. 

Following the news of the outage, HYPE was still trading at $43.69. The asset relies mostly on its native DEX, with no chance to immediately trade or short. The Hyperliquid team has still not explained the nature of the attack.

Over 500K accounts were affected

While Hyperliquid boasts of being decentralized, the API outage and lack of frontend access meant over 500K accounts may be affected. The short episode raised the issue of depending on a single point of failure, even if the perps DEX settled all trades on-chain. 

Until Hyperliquid recovered full service, around $538M in net deposited funds were stuck on the exchange, based on DeFi Llama liquidity data. 

During the outage, one of the most prominent Hyperliquid whales, James Wynn, was caught in another risky long position. Wynn bet on PEPE, expecting the meme token’s recovery. Despite the general Hyperliquid trading outage, the position went through partial liquidations. 

The PEPE long position carries over $63K in unrealized losses, which were updated during the outage. Wynn was also partially liquidated several times, suggesting other positions may have been affected outside the control of their holders.

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