Key Highlights:
- Hyperliquid CEO Jeff Yan just took aim at centralized exchanges like Binance.
- He alleged that these exchanges are underreporting liquidation data amid a volatile market.
- The statements led to an unrest in the crypto market as netizens demand transperancy.
Jed Jeff Yan, the CEO and co-founder of decentralized trading platform Hyperliquid, took a dig at large centralized exchanges (CEXs). He claimed that CEXs such as Binance are hiding the actual extent of liquidation of assets during times of extreme market volatility. This statement has caused an uproar in the crypto sphere.
Hyperliquid CEO Takes Aim At Binance & Other Exchanges
In one of his posts on X, Yan implied that there are exchanges where the number of liquidation events in rapid succession is deliberately underreported. According to him, Binance, as an example, records only one liquidation per second, despite thousands of positions being closed at the same time. In his opinion, this practice gives a wrong impression of the market responses to fluctuations in prices.
“Hyperliquid’s fully on-chain liquidations cannot be compared with underreported CEX liquidations,” Yan wrote. He added, “Some exchanges publicly acknowledge that they aggregate liquidation data. In extreme cases, this could mean users see only one event when hundreds actually occur in the same second.”
Hyperliquid’s fully onchain liquidations cannot be compared with underreported CEX liquidations
Hyperliquid is a blockchain where every order, trade, and liquidation happens onchain. Anyone can permissionlessly verify the chain’s execution, including all liquidations and their… pic.twitter.com/K5sv74LJgO
— jeff.hl (@chameleon_jeff) October 13, 2025
The comments of Yan brought back the old issues in the industry as to why there was no transparency in centralized exchanges and their effect on the trust that the traders have. The founder compared CEX practices with the Hyperliquid model, stating that all the orders, trades, and liquidation on his platform are stored on the blockchain.
He observed that such an arrangement allows everybody to check up in real time all the activity in the market, as well as evidence of solvency, and fairness of liquidation. “The ability to permissionlessly verify execution and solvency is essential for financial integrity,” Yan stated. He further added, “Transparency and neutrality should be the baseline for the next generation of global markets.”
His remarks emerged during a wave of forced liquidations throughout the crypto industry, as plunge-priced leveraged positions were cleared. The tracking services, including Coinglass and Laevitas, have shown that over $1 billion worth of positions were sold off in a single day. However, on-chain analytics services on decentralized exchanges showed that the real numbers could be much greater.
The problem has led to an expanding philosophical gap between centralized and decentralized trading structures. Whereas CEXs, such as Binance, conduct transactions off-chain, decentralized exchanges (DEXs), such as Hyperliquid, transparently conduct transactions on publicly accessible blockchains. It implies that market activity can be audited independently by traders and analysts, but CEX users have to use the data feeds provided by the exchanges.
CEXs Defend Their Stance
In its defense, the advocates of centralized exchanges point out that the act of grouping or capping the liquidation data should mostly be seen as technical, as opposed to being deceptive. In some cases, CEX representatives have clarified that the real-time publication of every single liquidation event may overload systems and cause performance bottlenecks. Still others claim that aggregated reporting will assist in keeping a user-friendly interface that is not overloaded with dashboards when activity is high.
Nevertheless, market analysts and market observers argue that such actions pose greater questions in the reliability of the market. They observe that when the liquidation updates, which are throttled or selectively presented, traders can get the actual risk exposure wrong. Cascading liquidation events may also be obscured by the lack of real-time visibility, and it would be more challenging to evaluate liquidity conditions or market stress.
The debate highlights the current state of transparency as a competitive variable amongst trading models. With more and more decentralized exchanges gaining traction and investors becoming more focused on verifiable information, industry participants are keeping an eye on whether centralized platforms can change how they disclose information.
Although Binance has not publicly responded to these allegations by Yan, the controversy has heightened the call for more explicit reporting standards throughout the industry. With traders requiring increased levels of transparency, the debate between central authority and on-chain responsibility continues to define the digital asset market.
Also Read: Binance News: Latest Updates and Developments To Watch
