Hyperliquid’s JELLY Exploit Highlights DeFi Vulnerability Concerns

Dr. Jan Philipp Fritsche of Oak Security has outlined the specific causes behind the $10.63 million loss in Hyperliquid’s recent token exploit, emphasizing that this incident demonstrates a wider problem within decentralized finance (DeFi). According to Dr. Fritsche, market manipulation was the driving force behind the exploit, with traders exploiting an uncapped payout system and lack of risk isolation. This resulted in Hyperliquid absorbing the losses while the attackers walked away unscathed.