Hyperliquid Sees Massive Outflows Amid Concerns Over Alleged Presence Of North Korea-Linked Hackers

Layer 1 cryptocurrency derivatives platform Hyperliquid has suffered a massive blow amid rising fears over the platform's security after a security expert revealed that hackers linked to North Korea (the Democratic People's Republic of Korea) had been using the Hyperliquid platform for at least a few months now.

Despite the news, the price of HYPE, the platform's native token, remains in the green and is up by nearly 4% in the last 24 hours. On the other hand, the daily chart shows that the crypto coin has been very volatile in the past day since news of the security concerns spread on social media.

Hyperliquid Sees Peak Outflows After Risk Reveal

On Monday, after Metamask security researcher Tay Monahan published onchain data regarding the potential use of DPRK-linked hackers of the Hyperliquid platform, outflows on the platform hit an all-time high of $502.71 million, as per Dune Analytics data.

"Hyperliquid dudes don't seem worried at all though so I'm sure it's fine," Monahan wrote in a series of posts on X Monday. "DPRK doesn't trade. DPRK tests," she added, indicating that accounts used by North Korea-linked hackers "test" the security of crypto platforms.

Monahan went on to reveal that he offered to discuss the matter with the Hyperliquid team two weeks ago. She reiterated that his offer to provide security advice to the team still stands. "A massive amount of harm will come to people if you don't harden your a** asap," she warned.

On its Discord channel, Hyperliquid said it was aware of reports around "activity by supposed DPRK addresses," but that there has been no exploit so far and "all user funds are accounted for."

It also said it has reached out to "trusted parties" instead of "someone claiming to be a security party" to confirm that the platform was following industry best practices.

Some Crypto Users Still Concerned

Despite Hyperliquid's statement about the matter, there are still concerns that the platform may be too complacent. "A thief never says he is a thief," said one user who suggested that Hyperliquid provided a "self-signed clearance certificate" about its platform's security instead of a legitimate clearance from a trusted blockchain security firm or solutions provider.

Some prominent crypto players have also expressed concern over the issue, including PulseChain MPC wallet Pulse Wallet.

News of the presence of North Korea-linked exploiters came months after prominent blockchain sleuth ZachXBT revealed how Lazarus Group, a notorious hacking group tied to the country, had been laundering some $200 million in stolen crypto during its three-year hacking spree across the crypto space.

Among the security breaches in crypto that were tied to Lazarus Group by security experts were the hackings of crypto exchange CoinMetro ($750,000 in digital assets lost), and Canadian exchange CoinBerry ($370,000 in Bitcoin and Ethereum wiped out).

It remains to be seen how the news will further affect Hyperliquid and whether it will soon release official documentation on its work toward securing the platform.