Hyperliquid API outage causes freeze on trading, HYPE down 5%

Hyperliquid’s frontend crashed for half an hour, pausing all trading on the platform and shaking confidence in its token.

In DeFi, decentralization only goes so far, especially when it comes to user-facing components. On Tuesday, July 29, between 14:20 and 14:47 UTC, Hyperliquid’s (HYPE) API crashed, disabling front ends and pausing trading. During that period, users could not open or close trades, enter or exit short positions, or withdraw their funds.

The issue stemmed from an API server malfunction caused by a sudden spike in traffic. This API facilitates communication between the Hyperliquid DeFi protocol and its centralized front end, which includes its mobile apps and website.

The backend, including the Hyperliquid DEX and its layer-1 blockchain network, continued to function. However, as the front end was down, traders could not interact with the network or the DEX through standard interfaces. Traders were unable to close open positions or execute trades.

Hyperliquid downtime shows DeFi fragility

While the issue was resolved quickly, the outage reveals hidden vulnerabilities in many supposedly decentralized services. Although the Hyperliquid DEX and network are decentralized, the website and mobile apps used to access them are not.

Many DeFi platforms rely on centralized servers to run their front ends. Websites and mobile apps are difficult to operate in a decentralized manner, making them a critical vulnerability. Attackers often perform front-end attacks, targeting DeFi protocol websites to carry out phishing or other schemes.

For instance, Curve Finance suffered a website DNS hijacking in May 2025. In September of 2024, hackers took over Ethena Labs’ website, while in 2023, the same thing happened to Balancer. In all of these cases, the underlying blockchain infrastructure was not affected.

HYPE token fell about 5% shortly after the outage, from $45 to a low of $42.87. The token has since recovered to $44.25, but the issue continues to weigh on investor sentiment.