Trader nets $1.28 million on new 1,000x exchange Papertrade by moving Hyperliquid’s ETH prices

Papertrade, a perpetuals venue that went live on Hyperliquid's HyperEVM layer at 10 a.m. ET on Saturday, offers up to 1,000x leverage. Within hours of launch, one wallet had booked roughly $1.28 million in profit by moving the ETH price Papertrade uses to settle trades.

The exchange prices each trade at the midpoint of Hyperliquid's best bid and offer and takes the other side through a shared USDC pool funded by trader losses; losing traders collect the protocol's PAPER token. Wallet 0x2025...840e repeatedly opened large positions on Papertrade, then bought or sold thousands of ETH on Hyperliquid to shift that reference price before closing. Between 6:01 and 6:02 p.m. ET it bought about 6,060 ETH as the price rose roughly $3; at 6:03 p.m. it sold about 5,210 ETH as the price fell about $3.50. At 1,000x leverage, a 0.1% move equals a position's full margin.

The wallet traded roughly $231 million of ETH on Hyperliquid that evening and paid about $52,000 in fees. Papertrade's portfolio page shows $1.28 million of profit on $3.18 billion of volume; the wallet withdrew about $2.48 million on Saturday against $1.2 million of deposits, including a single $1.54 million withdrawal at 6:06 p.m. At 7:13 p.m. it opened 30 ETH shorts at 660x leverage worth a combined $297 million notional, then sold about 6,590 ETH over three minutes, pushing the price to $2,504.40. The shorts stayed open more than three hours and were liquidated at 10:31 p.m. at $2,509.95 for a $450,000 loss, minting about 17.6 million PAPER.

X users Boblob and butler flagged the activity, with butler publishing the address and speculating that Papertrade may have blocked the wallet from closing the shorts. Across its life the wallet has logged about $14.2 billion in volume and $13.1 million of profit on Hyperliquid, beginning in February 2025 with about $2 million of deposits.

Tighter caps

Papertrade said Sunday the overnight manipulation attempts on BTC and ETH were not an oversight in a mechanism design it spent six months building. It blamed open-interest caps set loosely to meet launch demand, saying it has begun tightening them onchain and at the relayer level, and that its launch queue made the timing of opens and closes unpredictable. Papertrade said the trader later gave almost all the gains back through new accounts and that some users agreed to reverse manipulated trades in return for keeping earned PAPER. The 0x2025 wallet's withdrawals still exceed its deposits by about $1.28 million on Papertrade's records. The protocol says its liquidity pool holds $5 million and has paid $25 million to PAPER stakers, with the pool balance falling from about $5 million to $2.4 million before recovering. Papertrade was co-founded by two traders known as Jez and Blurr.

Hyperliquid's own liquidity vault has absorbed losses from large single-trader positions before: about $4 million after a whale's leveraged ETH position was liquidated in March 2025, and about $4.9 million on a POPCAT position in November 2025, when the network paused deposits and withdrawals. Papertrade and Hyperliquid were contacted for comment.