This episode explores the Hyperliquid DEX's recent crisis, triggered by a massive short squeeze on the low-liquidity meme coin, Jelly Jelly. A trader's deliberate liquidation, exploiting Hyperliquid's HLP (crowdfunded market maker) mechanism, left HLP with a massive short position. Against this backdrop, OKEx and Binance's subsequent listing of Jelly Jelly perps intensified the short squeeze, leading to Hyperliquid validators' controversial decision to delist Jelly Jelly and artificially close the position at a favorable price for HLP, resulting in a significant drop in Hyperliquid's token price. More significantly, the discussion delves into the debate surrounding Hyperliquid's actions, questioning its decentralization and fairness. For instance, the panelists discuss whether bailing out HLP depositors was the right move and analyze the implications for the broader DeFi ecosystem. The conversation then pivots to the Say Protocol's ambitious plan to acquire 23andMe, raising concerns about data privacy and the potential misuse of sensitive genetic information. Finally, the episode touches upon the evolving stablecoin legislation in the US, comparing the GENIUS Act and the STABLE Act, and predicting a less restrictive outcome with the caveat of no yield on stablecoins. This highlights the ongoing tension between innovation and regulation in the crypto space.
