Hyperliquid News Today: User Error Exposes DeFi Weakness: $21M Stolen from Hyperliquid Wallet

Source: [1] Hyperliquid User Loses $21 Million to Hackers After Private Key Breach (https://cryptonews.com/news/hyperliquid-user-loses-21-million-to-hackers-after-private-key-breach/) [2] Hyperliquid Trader Loses $21M in Private Key Exploit (https://cointelegraph.com/news/hyperliquid-21m-private-key-exploit-defi-security) [3] $21 Million Vanishes After Hyperliquid Wallet Hack (https://coinpedia.org/news/21-million-vanishes-after-hyperliquid-wallet-hack/) [4] $21 Million Stablecoin Heist: Private Key Leak Rocks Hyperliquid Trader (https://markets.financialcontent.com/stocks/article/breakingcrypto-2025-10-10-21-million-stablecoin-heist-private-key-leak-rocks-hyperliquid-trader-funds-bridged-to-ethereum)

A major exploit targeting Hyperliquid, a decentralized perpetual trading platform, resulted in a $21 million loss due to a private key compromise, according to blockchain security firms PeckShield and PeckShieldAlert. The breach, reported on October 10, 2025, involved the theft of 17.75 million DAI and 3.11 million MSYRUPUSDP tokens from a user's wallet linked to Hyperliquid's Hyperdrive lending protocol.

The attacker swiftly bridged the stolen assets to the Ethereum network, complicating recovery efforts. PeckShield's on-chain analysis revealed that the compromised wallet executed a $16 million HYPE long trade closure and liquidated 100,000 HYPE tokens for $4.4 million in DAI, suggesting the hacker capitalized on the stolen assets immediately. Further investigations by CertiK highlighted that private key breaches accounted for 39% of crypto exploits in 2024, underscoring systemic vulnerabilities in self-custody practices.

Hyperliquid confirmed the platform's infrastructure remained secure, attributing the loss to the user's compromised private key rather than a protocol vulnerability. The incident aligns with broader trends in DeFi security, where user-side breaches-often stemming from phishing, malware, or poor key storage-outpace smart contract exploits. CertiK's 2025 report noted $1.05 billion in losses from 296 private key breaches, emphasizing the human factor in crypto security.

Security experts reiterated standard precautions for DeFi users, including cold wallet storage for large balances, multi-signature setups, and regular token approval audits. Hyperliquid's documentation explicitly warns against sharing private keys, a principle violated in this case. The platform's recent airdrop to 94,000 addresses and high trading volumes-exceeding $3.5 billion in a single week-highlighted its growing attack surface, particularly for users with lax operational security.

The breach also drew comparisons to similar incidents in 2024, such as the $27 million loss on Venus (BSC) and the $1.2 million Seedify DAO exploit, both tied to private key compromises. Analysts noted that decentralized exchanges (DEXs) like Hyperliquid, while offering transparency and autonomy, shift custodial responsibility to users, amplifying risks from individual security lapses.

Hyperliquid's response included advising users to monitor on-chain activity and revoke unnecessary token approvals. The incident underscores the need for advanced security measures, such as hardware wallets and multi-party computation (MPC) solutions, as DeFi adoption expands. With institutional participation in DeFi rising, regulatory and technical safeguards will play a critical role in mitigating future exploits.