Hyperliquid Pauses Arbitrum Bridge After Popcat Liquidations Saddle HLP With About $5 Million in Losses

Overview

• Hyperliquid temporarily halted USDC deposits and withdrawals on its Arbitrum bridge, with a Discord admin saying other rails should be unaffected.
• The platform’s community-owned HLP vault absorbed roughly $4.9–5 million in bad debt tied to the forced unwinds, according to Hyperliquid’s site.
• Blockchain data indicates a trader withdrew about $3 million, split it across roughly 19–20 wallets, and used around 5x leverage to build $20–25 million in Popcat longs.
• Researchers reported a large buy wall near $0.21 that later vanished, triggering near-simultaneous liquidations; the activity was characterized as likely manipulation.
• An on-chain transaction shows an EmergencyLock was triggered on Arbitrum, developers manually closed remaining positions, and some withdrawals later processed without a full restart timeline.