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Papertrade suspected of price manipulation by two addresses; protocol vulnerability exposed

Kucoin • October 11, 2026

[Opinion: Papertrade allegedly targeted by price manipulation via two addresses, revealing clear protocol vulnerabilities] Gold财经 reports that on October 11, a user on X platform named Boblob posted claiming that Papertrade is being actively exploited by two wallet addresses. These addresses are executing trades on Hyperliquid with individual sizes of approximately $20 million, causing ETH price fluctuations of 10 to 20 basis points, and subsequently establishing long positions on Papertrade with notional values reaching hundreds of millions of dollars.

The user argues that this exposes a clear vulnerability in Papertrade’s current protocol, which must be urgently patched; otherwise, long-term sustainable development will be unattainable. This claim currently remains an unverified allegation by the user.

The full story

This article is one source in a clustered incident — the cluster page carries the summary, timeline and every other outlet covering it.

Potential Manipulation of ETH Prices in $20M Papertrade Incident On October 11, 2026, two wallets allegedly manipulated Ether (ETH) prices on the Hyperliquid platform by executing $20 million in trades, potentially affecting Papertrade's synthetic pricing. The trades moved ETH prices by 0.1% to 0.2%, raising concerns about the vulnerability of Papertrade's pricing mechanism, which relies on Hyperliquid's best bid and offer (BBO). Reports indicate that a trader exploited this mechanism to earn approximately $1.28 million in profit within eight hours by manipulating prices through large trade volumes. Despite community accusations and the acknowledgment of risks in Papertrade's documentation, there is no confirmed proof of the wallets' identities or losses incurred. As of now, the situation remains unresolved, with no official response from Papertrade and no compensation plans announced. The incident has led to increased trading volume for ETH, surpassing Bitcoin's, indicating heightened market activity linked to the exploit. 5 sources 59

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Companies (3)

Hyperliquid Papertrade X