Solana-Based Meme Coin Jelly-My-Jelly Triggers Hyperliquid Crisis

On Wednesday, March 26th, the crypto market recorded a slight downtick when Bitcoin price reverted from $88,000. Amid the renewed selling pressure, meme coin mayhem has erupted across the DeFI markets as Jelly-My-Jelly, a newly launched Solana-based memecoin witnessed a massive short squeeze.

Crypto market saw a slight downtick on Wednesday as Bitcoin price slipped from $88,000. Amid renewed selling pressure, meme coin mayhem has erupted across the DeFI markets as a newly launched Solana-based memecoin saw a massive short squeeze. This liquidation brought attention to Hyperliquid as it wiped out millions in investors' money.

Solana’s New Meme Coin Triggers Hyperliquid Crisis

A meme coin frenzy sent shockwaves in the DeFI market after Solana-based memecoin Jelly-My-Jelly soared nearly 500% in a violent short squeeze that left decentralized exchange Hyperliquid scrambling to quantify the financial damage.

The chaos unfolded when a trader opened a short position of 430 Million JELLYJELLY for $0.0095. Minutes later, this trader closed their short at $0.0103 and pulled $2.76M in the margin, leaving Hyperliquid Vault to absorb the remaining short position, which totaled 398 million JELLY (worth over $4.5 million).

Historical data shows that the jellyjelly short order taken over by Hyperliquid Vault was settled at $0.0095 at 23:15 UTC+8, slightly earlier than the announcement of Binance's online contract, when the price was about $0.045. At the settlement price of $0.0095, HLP Vault also absorbed 398 million JELLY. At that time, the market value was about $3.78M, but the total loss after liquidation was over $10M.

Amid margin pulled and Hyperliquid holding the bag, the JELLYJELLY price continued to rise from $0.01 to $0.04, leaving HLP with an initial loss exceeding $10 million. Adding to the meme coin’s bullish note and another liquidation attack on Hyperliquid Binance and OKX exchanges, they planned to list JELLY perpetuals.

In response to the suspicious activity, Hyperliquid's validator set convened and voted to delist JELLY perpetuals. As of now, the 24-hour PnL of HLP stands at around $700,000 USDC. Hyperliquid has announced that users — excluding flagged addresses — will be automatically reimbursed by the Hyper Foundation based on on-chain data in the coming days.

After evidence of suspicious market activity, the validator set convened and voted to delist JELLY perps.

All users apart from flagged addresses will be made whole by the Hyper Foundation. This will be done automatically in the coming days based on onchain data. There is no need to contact support.

— Hyperliquid (@HyperliquidX) March 26, 2025

However, critics are calling for a revamp of Hyperliquid's value and risk system, especially the ability to offload short to HLP after pulling margin.

JELLYJELLY Price Is Poised For Major Support Test

The daily chart shows a long-wick rejection candle at $0.046 resistance, indicating high selling pressure. This overhead supply signals the continuation of its prevailing consolidation trend between the aforementioned resistance and $0.035 support.

If today’s volatility and market manipulation continue to strengthen the seller’s grip over this asset, the downward trend could extend another 80% and retest the bottom support.

With the momentum indicator RSI signaling increasing buying pressure at the bottom, the coin price could rechallenge the $0.046 resistance for another breakout.