Hyperliquid Labs debunks DPRK links, but experts are unsure

Hyperliquid Labs, the team behind HYPE’s $28 billion FDV token, refuted claims that North Korean hackers had infiltrated its layer-1 protocol.

Hyperliquid Labs (HYPE) shared an announcement debunking any links between whale activity and a possible exploit masterminded by hackers from the Democratic People’s Republic of Korea. Per a message published on the project’s Discord server, “no vulnerabilities have been shared by any party,” and white hats are welcome to submit bug reports as part of a “generous bug bounty program.

On Dec. 23, a HYPE whale sold 1 million tokens amid speculation that North Korean hackers actively traded on the layer-1 blockchain. Security veterans like MetaMask developer Taylor Manohan stated that hackers, likely part of the notorious Lazarus Group, may be prodding for weakness.

Data showed that DPRK-tagged wallets executed on-chain swaps and lost about $700,000. “Yall, DPRK doesn’t trade. DPRK tests” Tayvano, as Manohan is known online, asserted while community members searched for answers.

We are aware of reports circulating regarding activity by supposed DPRK addresses. There has been no DPRK exploit – or any exploit for that matter – of Hyperliquid. All user funds are accounted for. Hyperliquid Labs takes opsec seriously.

Hyperliquid Labs via Discord

Hyperliquid debacle

The matter became heated on social media, as HYPE holders bashed Manohan for spreading FUD – an acronym for “fear, uncertainty, doubt” – around Hyperliquid.

Yet, industry leaders like Polygon CISO Mudit Gupta, Coinbase director Conor Grogan, and podcaster Laura Shin rallied about Manohan, emphasizing the merits of her security advice. Gupta, in particular, echoed Manoha’s suggestion to tighten security by decentralizing its multi-signatory permissions and addressing central points of failure.

North Korean hackers have stolen nearly $2 billion from crypto users and protocols this year alone. The FBI warned that Lazarus was aggressively targeting digital asset trading venues back in September, and DPRK bad actors are suspected to have siphoned north of $4 billion in cryptocurrencies over the years.