Disclaimer: The opinion expressed here is not investment advice – it is provided for informational purposes only. It does not necessarily reflect the opinion of BitMaden. Every investment and all trading involves risk, so you should always perform your own research prior to making decisions. We do not recommend investing money you cannot afford to lose.

Analyst Sees Hyperliquid’s $4M Loss as a Growth Opportunity for DeFi

Following yesterday’s whale liquidation event on Hyperliquid, which saw the decentralized exchange (DEX) lose $4 million, some analysts are characterizing it as a necessary stress test that could ultimately strengthen decentralized finance (DeFi) protocols. Others have even suggested that the incident could benefit Hyperliquid’s native HYPE token in the long run. Lessons Learned The loss occurred when a trader, identified by the wallet address 0xf3f4, opened a 175,000 ETH long position with 50 times leverage, valued at $340 million. After securing an unrealized profit of $8 million, the trader reportedly withdrew $17.09 million in margin, triggering an automatic liquidation of the remaining 160,000 ETH. Hyperliquid’s HLP vault absorbed the position at $1,915 per ETH, putting it $4 million in the red. However, some analysts remain optimistic about the platform’s future. Prominent DeFi commentator Aylo argued that stress tests, like the one Hyperliquid went through, are necessary to improve protocol design. “In this case, 1% hit on HLP was a very reasonable price to pay for the lesson learned and the apparent vulnerabilities discovered,” he said. Additionally, he noted that while HYPE remains a risky investment given prevailing market conditions, its revenue stream and market share in the perps trading space make it undervalued. According to data from DefiLlama, the token’s price-to-earnings (P/E) ratio stands at 7.06, which, in Aylo’s opinion, hints at a potential upside if Hyperliquid continues to grow. In the aftermath of the liquidation, HYPE lost 8.5% of its value but recovered soon after. Still, the broader market jitters seem to have caught up with it, dropping 11.4% from its price in the last 24 hours and just under 28% across the week. Ben Zhou Calls for More Risk Management Tools Bybit CEO Ben Zhou also weighed in on the event, highlighting the risks associated with high leverage on both centralized and decentralized exchanges. In a post on X, he explained how the protocol’s liquidation engine took over the massive position and cushioned its impact by lowering leverage. The crypto executive, whose company was recently on the wrong end of the largest hack in the industry’s history, suggested that DEXs must put in place stronger risk management mechanisms, including dynamic risk limits and market surveillance tools, to prevent similar occurrences in the future. The incident has prompted Hyperliquid to lower its maximum leverage for Bitcoin and Ethereum to 40x and 25x, respectively. He pointed out that HLP had been operating successfully for about two years with minimal issues and that the team has a track record of quick responses to challenges. The post Analyst Sees Hyperliquid’s $4M Loss as a Growth Opportunity for DeFi appeared first on CryptoPotato . The Crypto Basic

---

Cardano (ADA) Struggle Persists—Is a Rebound Still Possible?

Cardano price started a fresh decline below the $0.720 zone. ADA is correcting some losses and might face resistance near the $0.7750 level. ADA price started a recovery wave from the $0.650 zone. The price is trading below $0.720 and the 100-hourly simple moving average. There is a connecting bearish trend line forming with resistance at $0.7050 on the hourly chart of the ADA/USD pair (data source from Kraken). The pair could start another increase if it clears the $0.720 resistance zone. Cardano Price Faces Hurdles In the past few days, Cardano saw a bearish wave below the $0.7750 level, like Bitcoin and Ethereum . ADA declined below the $0.750 and $0.720 support levels. Finally, it tested the $0.650 zone. A low was formed at $0.6495 and the price recently started a recovery wave. The price climbed above the $0.6950 and $0.70 level. The price even spiked above the 50% Fib retracement level of the downward move from the $0.8170 swing high to the $0.6495 low. Cardano price is now trading below $0.720 and the 100-hourly simple moving average. There is also a connecting bearish trend line forming with resistance at $0.7050 on the hourly chart of the ADA/USD pair. On the upside, the price might face resistance near the $0.7050 zone. The first resistance is near $0.7520 or the 61.8% Fib retracement level of the downward move from the $0.8170 swing high to the $0.6495 low. The next key resistance might be $0.7750. If there is a close above the $0.7750 resistance, the price could start a strong rally. In the stated case, the price could rise toward the $0.80 region. Any more gains might call for a move toward $0.850 in the near term. Another Drop in ADA? If Cardano’s price fails to climb above the $0.720 resistance level, it could start another decline. Immediate support on the downside is near the $0.6880 level. The next major support is near the $0.650 level. A downside break below the $0.650 level could open the doors for a test of $0.6350. The next major support is near the $0.620 level where the bulls might emerge. Technical Indicators Hourly MACD – The MACD for ADA/USD is losing momentum in the bearish zone. Hourly RSI (Relative Strength Index) – The RSI for ADA/USD is now below the 50 level. Major Support Levels – $0.6880 and $0.6500. Major Resistance Levels – $0.7520 and $0.7750. The Crypto Basic