China solves the "Hyperliquid Money Laundering Case": the method is similar to James Wynn, intentionally losing money to launder it to the opposing party.
Chinese law enforcement authorities have detected cases of using the Hyperliquid platform's highly leveraged mechanism to launder money, which they believe exists, highlighting the challenges of DeFi regulation and risk control. (Synopsis: James Wynn broke the contract just 2 hours after quitting the contract!) Open another 40 times BTC long order, and also beg the community for a deposit) (Background supplement: a weekly loss of more than $60 million) James Wynn: I still have more money than you, and my monthly passive income exceeds yours for a year) Chinese law enforcement agencies have recently uncovered a number of cryptocurrency money laundering cases using decentralized trading platform Hyperliquid. Since March 2025, at least three such cases have been detected, and criminals have cleverly used the high leverage and forced liquidation mechanism provided by the platform to "launder" illegal funds by creating false trading losses. Analysis of money laundering methods: transfer of funds under high leverage According to Mirror Tang, co-founder of Web3 security company Salus, revealed on social media that the core method of these money laundering operations is to deliberately trigger the loss of highly leveraged positions on the Hyperliquid platform, and at the same time, pre-establish reverse positions on centralized exchanges to achieve profits, so as to complete the bleaching process of illegal funds. Mirror Tang noted: "Since March this year, Chinese law enforcement agencies have detected three cases of cryptocurrency money laundering using Hyperliquid. The operation method is to use Hyperliquid's high-leverage liquidation mechanism to flush out illegal gains: create liquidation losses on HL, reverse position opening on centralized exchanges to make profits, and complete fund bleaching." Specifically, money launderers first opened highly leveraged contracts with Hyperliquid with illegal funds, and deliberately operated to cause positions to be forcibly liquidated, ostensibly causing huge investment losses. However, they have already synchronously opened positions opposite to Hyperliquid positions on other centralized trading platforms. When a Hyperliquid position is liquidated, the opposite position on the centralized platform makes a profit, allowing illegal funds to flow back into the financial system in the form of seemingly legitimate trading profits. Similarity of trading strategies to well-known traders It is worth noting that Mirror Tang observes that the structure of this type of money laundering strategy is highly similar to some of the transaction paths used by James Wynn, a well-known cryptocurrency trader, and he is not accusing Wynn himself of money laundering, but there are huge similarities in this approach, such as James Wynn's famous use of 10 to 40 times leverage in the cryptocurrency market for short-term trading. Its trading strategy focuses on capturing short-term trading opportunities arising from high swings in market sentiment. In response to these illegal activities using platform mechanisms, Mirror Tang also directly called on the founders of the Hyperliquid platform in his tweet to attach great importance to and strengthen the platform's risk control measures. He warned that if Hyperliquid fails to effectively address the current lack of risk control, the platform will face a high risk of regulatory intervention in the future. With the rapid development and popularity of decentralized financial (DeFi) platforms, how to encourage technological innovation and maintain market vitality while effectively preventing the platform from being used for financial crimes such as money laundering has become a major challenge that global regulators and DeFi platforms themselves must face together. The exposure of Hyperliquid-related cases once again highlights the evolving methods of financial crime and the urgent need to strengthen the transparency and compliance of DeFi platforms to address the increasingly complex problem of illicit capital flows. Related reports James Wynn performs "Crypto Gambler" to put on a show for Hyperliquid? Giant whale James Wynn "loses and admits defeat": Give up the contract, I want to leave this fallen place Giant whale James Wynn opened a short order and shouted "Bitcoin rushed $120,000": 99% BTC, 1% meme coin should be invested "China Detects "Hyperliquid Money Laundering Case": The method is similar to James Wynn, deliberately losing money and washing it to the counterparty" This article was first published in BlockTempo "Dynamic Trend - The Most Influential Blockchain News Media".
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China solves the "Hyperliquid Money Laundering Case": the method is similar to James Wynn, intentionally losing money to launder it to the opposing party.
Chinese law enforcement authorities have detected cases of using the Hyperliquid platform's highly leveraged mechanism to launder money, which they believe exists, highlighting the challenges of DeFi regulation and risk control. (Synopsis: James Wynn broke the contract just 2 hours after quitting the contract!) Open another 40 times BTC long order, and also beg the community for a deposit) (Background supplement: a weekly loss of more than $60 million) James Wynn: I still have more money than you, and my monthly passive income exceeds yours for a year) Chinese law enforcement agencies have recently uncovered a number of cryptocurrency money laundering cases using decentralized trading platform Hyperliquid. Since March 2025, at least three such cases have been detected, and criminals have cleverly used the high leverage and forced liquidation mechanism provided by the platform to "launder" illegal funds by creating false trading losses. Analysis of money laundering methods: transfer of funds under high leverage According to Mirror Tang, co-founder of Web3 security company Salus, revealed on social media that the core method of these money laundering operations is to deliberately trigger the loss of highly leveraged positions on the Hyperliquid platform, and at the same time, pre-establish reverse positions on centralized exchanges to achieve profits, so as to complete the bleaching process of illegal funds. Mirror Tang noted: "Since March this year, Chinese law enforcement agencies have detected three cases of cryptocurrency money laundering using Hyperliquid. The operation method is to use Hyperliquid's high-leverage liquidation mechanism to flush out illegal gains: create liquidation losses on HL, reverse position opening on centralized exchanges to make profits, and complete fund bleaching." Specifically, money launderers first opened highly leveraged contracts with Hyperliquid with illegal funds, and deliberately operated to cause positions to be forcibly liquidated, ostensibly causing huge investment losses. However, they have already synchronously opened positions opposite to Hyperliquid positions on other centralized trading platforms. When a Hyperliquid position is liquidated, the opposite position on the centralized platform makes a profit, allowing illegal funds to flow back into the financial system in the form of seemingly legitimate trading profits. Similarity of trading strategies to well-known traders It is worth noting that Mirror Tang observes that the structure of this type of money laundering strategy is highly similar to some of the transaction paths used by James Wynn, a well-known cryptocurrency trader, and he is not accusing Wynn himself of money laundering, but there are huge similarities in this approach, such as James Wynn's famous use of 10 to 40 times leverage in the cryptocurrency market for short-term trading. Its trading strategy focuses on capturing short-term trading opportunities arising from high swings in market sentiment. In response to these illegal activities using platform mechanisms, Mirror Tang also directly called on the founders of the Hyperliquid platform in his tweet to attach great importance to and strengthen the platform's risk control measures. He warned that if Hyperliquid fails to effectively address the current lack of risk control, the platform will face a high risk of regulatory intervention in the future. With the rapid development and popularity of decentralized financial (DeFi) platforms, how to encourage technological innovation and maintain market vitality while effectively preventing the platform from being used for financial crimes such as money laundering has become a major challenge that global regulators and DeFi platforms themselves must face together. The exposure of Hyperliquid-related cases once again highlights the evolving methods of financial crime and the urgent need to strengthen the transparency and compliance of DeFi platforms to address the increasingly complex problem of illicit capital flows. Related reports James Wynn performs "Crypto Gambler" to put on a show for Hyperliquid? Giant whale James Wynn "loses and admits defeat": Give up the contract, I want to leave this fallen place Giant whale James Wynn opened a short order and shouted "Bitcoin rushed $120,000": 99% BTC, 1% meme coin should be invested "China Detects "Hyperliquid Money Laundering Case": The method is similar to James Wynn, deliberately losing money and washing it to the counterparty" This article was first published in BlockTempo "Dynamic Trend - The Most Influential Blockchain News Media".