HyperVault Rug Pull Triggers $3.6M Panic on Hyperliquid

Key Points

• HyperVault Rug Pull Triggers $3.6M Panic on Hyperliquid
• 752 ETH moved to Tornado Cash, triggering scam alarms
• Socials deleted, audits disputed, users left in the dark
• Hyperliquid blockchain unaffected but ecosystem trust shaken

A major DeFi scandal is unfolding on the Hyperliquid blockchain after HyperVault, a yield optimization protocol, allegedly executed a rug pull, stealing over $3.6 million in user funds.

The incident came to light when blockchain security firm PeckShield detected 752 ETH being withdrawn from HyperVault’s smart contracts and routed to Tornado Cash, a popular crypto mixer used to obscure digital transactions.

#PeckShieldAlert #Rugpull? We have detected an abnormal withdrawal of ~$3.6M worth of cryptos from @hypervaultfi.

The funds were bridged from #Hyperliquid to #Ethereum, swapped into $ETH, and then 752 $ETH was deposited into #TornadoCash. pic.twitter.com/mHQLPYXvzS

— PeckShieldAlert (@PeckShieldAlert) September 26, 2025

This movement raised red flags immediately, as Tornado Cash is commonly associated with money laundering and scam exits. In this case, it appeared to be the final move in what looks like a deliberate and well-planned rug pull.

Shortly after the funds were drained, HyperVault’s X (formerly Twitter) account and Discord server were deleted without explanation. a classic exit scam move in the world of DeFi.

HyperVault X Account Deactivated. Source: Twitter – Techtoken

This sudden disappearance has left users reeling, with many realizing too late that the project had no confirmed audit and operated without meaningful transparency.

For those looking to explore safer options, some low-risk DeFi strategies on Ethereum could offer more security and stability compared to unaudited projects like HyperVault.

MAX REPOST 🚨: HYPERVAULT PROJECT IS DOING SHADY STUFF

Friends, withdraw your funds from the protocol ASAP until further updates! When I asked Hypervault developers about audits, they answered that: “Audits are pending via Spearbit, Pashov, and Code4rena; expected turnaround for… https://t.co/SMKLP9S1tR pic.twitter.com/NBwrsbwRT6

— HypingBull (@hypingbull) September 4, 2025

Fake Audits, Inflated TVL, and Vanished Socials

Before it vanished, HyperVault branded itself as a multichain digital vault and yield optimizer, marketing heavily to business users and yield farmers across the Hyperliquid ecosystem.

With a reported TVL (Total Value Locked) of $5.8 million, the project appeared to be gaining momentum. But now, users and on-chain analysts are questioning whether that figure was artificially inflated to attract more deposits before the HyperVault rug pull took place.

HyperVault TVL. Source: DefiLlama – Techtokens

Crypto community member HypingBull issued early warnings on September 4, calling out inconsistencies in the project’s audit claims. According to their research, HyperVault said audits were in progress, but at least two major audit firms denied involvement.

That didn’t stop the project from gaining traction.

Its messaging, which blended secure storage with yield farming, positioned HyperVault as a “next-gen” DeFi solution. But behind the sleek branding was an unaudited, unverified, and now-defunct project that took millions from users with little recourse.

HYPERVAULT RUGGED THEIR USERS

My suspicions were right. Hypervault just deleted all the social media accounts. Twitter has gone, the Discord has gone too.

What can we do? Revoke all the permissions on the wallet you used to connect to the website! That’s the only thing you can… https://t.co/RrqQHqLjj1 pic.twitter.com/TZWYKAeJiE

— HypingBull (@hypingbull) September 26, 2025

The HyperVault rug pull has now become a cautionary tale for the entire DeFi space, especially for those chasing gains without due diligence.

While some blockchains like BNB Chain are seeing renewed investor interest, they too face risks from shady projects unless properly vetted.

Is Hyperliquid Responsible or Just a Victim?

Even though HyperVault was built on Hyperliquid, the Layer-1 blockchain itself remains technically unaffected by the attack.

Hyperliquid is known for its high-speed performance and focus on perpetual futures and spot trading. The incident hasn’t compromised its infrastructure, and no bugs or exploits were found within the chain itself.

However, that hasn’t stopped the community from pointing fingers. Critics argue that fast-growing ecosystems like Hyperliquid often fail to vet third-party projects, which can damage long-term trust, even if the base layer is secure.

The HyperVault rug pull highlights the risk of unaudited projects in new ecosystems. It only takes one bad actor to shake user confidence, especially when there are millions of dollars involved.

Many now feel that Hyperliquid must set stricter standards for projects launching on its platform to avoid similar future disasters.

In contrast, chains like Cardano have focused on roadmap clarity and ecosystem maturity to avoid these pitfalls, something Hyperliquid may need to adopt going forward.

What HyperVault Users Should Do Right Now

If you interacted with the HyperVault protocol in any way, security experts strongly advise you to revoke all smart contract approvals immediately.

When users connect their wallets to a DeFi app, they often give that app permission to manage their tokens. If the project was malicious, or if the wallet keys are later compromised, those permissions can still be exploited.

Here’s how to stay safe:

• Visit Revoke.cash to disconnect permissions

• Use Etherscan’s Token Approval Checker to double-check approvals

• Never connect your wallet to unverified or unaudited projects again

While these steps won’t recover stolen funds, they can prevent future losses if more malicious code remains in HyperVault’s smart contracts.

As one Hyperliquid user put it bluntly:

“The only fix is prevention. If it’s unaudited, assume it’s unsafe.”

Sadly, in the world of blockchain, once funds are gone—they’re gone. The immutable nature of DeFi is both its strength and its biggest risk.

Those impacted may look toward more transparent initiatives like the Ronin buyback plan as examples of how protocols can rebuild user trust after facing controversy or losses.

HyperVault Rug Pull Could Set Back DeFi on Hyperliquid

The HyperVault rug pull isn’t just a black eye for users—it’s a major credibility challenge for the Hyperliquid ecosystem itself.

As newer Layer-1 chains like Hyperliquid compete with Ethereum, Solana, and others, they’re constantly trying to attract both developers and users. But when multi-million dollar scams happen under their roof, even without direct involvement, it erodes trust.

This event may slow down adoption or push users to demand higher security standards before depositing into DeFi apps on Hyperliquid.

Meanwhile, centralized players like Tether have recently published detailed reserve breakdowns to reassure users, something the DeFi world still struggles with. The contrast in transparency is growing starker.

For now, Hyperliquid’s core chain remains untouched, but public silence from the protocol’s team and ecosystem leaders like HYPEconomist isn’t helping.

Moving forward, users, developers, and investors alike are watching to see how Hyperliquid responds, not technically, but transparently.

Until then, the HyperVault rug pull will remain a reminder of how fast, easy money in DeFi can come with fast, devastating losses.