A Crypto Whale’s Single-Click Mistake Cost Him $400,000

An anonymous whale named Mk4, trading on the cryptocurrency and derivatives trading platform Hyperliquid, lost approximately $400,000 due to an erroneous order in gold trades.

The incident occurred when the investor attempted to initiate a TWAP order with the “reduce only” option to reduce their existing GOLD long position.

According to reports, Mk4 only held a few hundred thousand dollars worth of GOLD long positions. However, it mistakenly sent a TWAP order to open a short position of 24,000 GOLD, worth approximately $109 million, for the next 50 minutes. It is stated that approximately 17,600 GOLD, or about $80 million, had already been traded before the error was discovered.

In the first 10 minutes after the TWAP order was launched, the price of gold in global markets fell by approximately 0.3%, while the decline in the GOLD market on Hyperliquid was sharper, reaching approximately 0.5%. This indicates that a large-volume erroneous trade affected the short-term price movement on the platform.

Realizing his mistake, the investor halted the TWAP transaction and then initiated a new TWAP process, this time with gradual buying, to close the large short position he had opened. It was reported that the position closing process continued for 2 to 4 hours.

As a result of the incident, Mk4 reportedly suffered approximately $400,000 in losses.

*This is not investment advice.