Hyperliquid’s HyperVault Project Rugged for $3.6M as Developers Vanish into Thin Air

Another day, another DeFi disaster—Hyperliquid's HyperVault joins the hall of shame with a $3.6 million exit scam that leaves investors holding empty bags.

The Great Disappearing Act

Developers pulled off the ultimate vanishing trick, cutting ties and bypassing accountability faster than you can say 'decentralized finance.' The HyperVault project now stands as a ghost town—digital assets gone, communication channels silent, and $3.6 million evaporated into the crypto ether.

Pattern Recognition

This isn't innovation—it's the same old story with a fresh coat of paint. Projects promise revolutionary returns but deliver classic rug pulls. The $3.6 million heist follows the playbook perfectly: build trust, attract capital, then disappear before anyone asks tough questions.

Finance's Cynical Reality

Because nothing says 'financial revolution' like watching your investment become someone else's retirement fund in the Bahamas. The only thing growing faster than blockchain technology? The creativity of exit strategies.

Tornado Cash Conceals $3.6M Trail as Social Accounts Vanish

The stolen funds followed a familiar pattern, with 752 ETH deposited into Tornado Cash to obscure transaction trails.

HyperVault’s official Twitter account now displays “this account doesn’t exist,” while their Discord server has also vanished.

Unfortunately, early alerts were raised on September 4 when community member HypingBull shared on X concerns about the project’s claimed security audits, but were ignored.

When HyperVault developers stated that audits were “pending via Spearbit, Pashov, and Code4rena,” an investigation revealed that none of these firms had been involved in the project.

The scam adds pressure to Hyperliquid’s ecosystem as HYPE token faces intense competition from ASTER DEX, which recently processed over $13 billion in daily perpetual futures volume.

Arthur Hayes previously exited his entire HYPE position for $823,000 profit, citing upcoming token unlocks worth $11.9 billion starting November 29. He is now considering getting back in.

Red Flags Ignored Despite Community Warnings

HypingBull’s September 4 alert warned users about HyperVault’s suspicious audit claims, urging immediate withdrawals of funds from the protocol, which had a total value of $700,000 locked at the time.

The investigator contacted Pashov directly via Telegram, receiving confirmation that they had “never heard of the project with this name.”

MAX REPOST: HYPERVAULT PROJECT IS DOING SHADY STUFF

Friends, withdraw your funds from the protocol ASAP until further updates! When I asked Hypervault developers about audits, they answered that: "Audits are pending via Spearbit, Pashov, and Code4rena; expected turnaround for… https://t.co/SMKLP9S1tR pic.twitter.com/NBwrsbwRT6

Code4rena’s website also showed no pending audits for HyperVault, contradicting the developers’ public statements about comprehensive security reviews.

Despite these revelations, many users continued to deposit funds, attracted by the platform’s advertised 90% APR yields on HYPE tokens.

HYPE Maxis, such as HYPEconomist, actively promoted the protocol until the final days, posting “cooking! use the money and put it into a hypervault” on September 23.

HYPEconomist is a shill for Hypervault that just rugged its users. Beware of scammers like this in the HL community. pic.twitter.com/0HVtvSD31g

The endorsement came just three days before the rug pull execution.

Now that they’ve successfully executed the scam, the forensic aftermath has discovered early warning signs, including the project’s lack of transparency about team identities and the suspicious absence of any legitimate audit documentation.

The high-yield promises should have also raised additional concerns given the DeFi market standards.

HyperVault’s disappearance follows a pattern of DeFi projects using attractive returns to lure victims before executing exit scams.

Just last month, CrediX Finance also executed a $4.5 million exit scam on August 8 after promising to recover stolen funds within two days.

The protocol’s team vanished after attackers, suspected to be them, gained administrative control of their multisig wallet, with all official accounts deleted and the website remaining offline since the exploit occurred.

Ecosystem Faces Growing Security and Competition Challenges

The HyperVault rug pull compounds existing pressure on Hyperliquid as ASTER DEX gained significant ground in perpetual trading volume.

ASTER’s Trust Wallet integration provides 100 million users with direct access to perpetual contracts, challenging Hyperliquid’s market dominance.

Previous exploits have tested Hyperliquid’s infrastructure, including the March JELLY token manipulation that cost the platform’s vault $13.5 million.

A trader used Leveraged positions and artificial price pumping to exploit the automated market maker system.

Similar incidents involved traders earning profits while causing vault losses, including “ETH 50x Big Guy,” who netted $1.8 million profit while the vault lost $4 million.

These exploits led to reduced maximum leverage limits from 40x to 25x for major cryptocurrencies.

Technical issues have also plagued the platform, including a 37-minute trading outage in July due to an API server overload caused by a surge in traffic.

The downtime caused price divergences as traders were unable to close positions during the halt.

For now, it is uncertain howwill react to this; however, with Arthur Hayes now polling followers about re-entering HYPE after the token dropped 23% weekly to $35.50.

Should I get back on the $HYPE train fam? pic.twitter.com/kNADDHUzks

He has restored Optimism after being one of the factors that contributed to its downtrend when he sold all his position, citing massive upcoming token unlocks that could create $500 million monthly sell pressure.