Shifting $576M of forced sales off public order books saved Hyperliquid from a systemic crash

Hyperliquid, an on-chain perpetual futures venue, sent most of the forced selling in the worst minute of the October 2025 crypto crash to the Hyperliquid backstop rather than its public order book, according to a new research preprint.About $641 million was force-sold on Hyperliquid at 21:19 UTC on Oct. 10, the paper found. Roughly $576 million went to the Hyperliquid backstop, while about $64 million reached the order book.The split is relevant because a thinning public order book can push prices lower and force more leveraged positions to close. The Hyperliquid backstop can interrupt that feedback by absorbing orders inside the venue. The preprint has not completed peer review, and its direct measurement covers Hyperliquid rather than the wider market.Hyperliquid’s liquidation rules first try to close a position through market orders. Under specified conditions, a liquidator vault can take over the position instead. That vault is a component strategy within the Hyperliquidity Provider (HLP) protocol vault.The study found that the backstop absorbed 62.6% of forced-sale value off-book after onset. The event was also highly compressed: 87.8% of forced selling after onset occurred wi...