Fartcoin’s price crashed 50% after $145 million manipulation bet went wrong
The liquidation was so large relative to the order book that Hyperliquid’s auto-deleveraging mechanism activated, forcibly closing profitable short positions on the other side of the trade to prevent the system from accumulating bad debt.
What to know:
- A highly leveraged long bet on the Solana-based memecoin Fartcoin imploded on the Hyperliquid exchange, triggering a 50 percent price crash and roughly $3 million in losses for the trader behind multiple wallets.
- On-chain data show two main wallets built a 145.24 million-token long position that helped drive Fartcoin’s rally before both were forcibly liquidated in large blocks as thin liquidity magnified the move lower.
- The liquidation was so large that Hyperliquid’s auto-deleveraging system kicked in, forcibly closing profitable short positions for about $849,000 in fee-free gains, while Fartcoin—already hit in a recent $270 million Drift Protocol exploit—now trades around $0.1244.
The trade blew up on Wednesday, crashing the token 50% in a single hourly candle from $0.2519 to $0.1244, and costing the entity behind the wallets roughly $3 million.
Fartcoin is a Solana-based memecoin minted on Pump.fun in October 2024 for 2 SOL. It holds no intrinsic value and features a transactional system in which each trade produces a digital flatulence sound, yet it has built a cult following large enough to make it a top-100 token by market cap and a top-10 token by derivatives open interest, with over $1 billion in futures exposure at its peak.
On-chain data from Hyperliquid shows how the position was assembled and how it came apart.
At least two wallets were used to build the long. Address 0x511c accumulated tokens through TWAP orders, an automated system that breaks a large buy into smaller pieces over time to minimize market impact, purchasing around $0.248 per token.
