Hyperliquid Activates Cross-Margin Auto-Deleveraging for the First Time: What Are HLP and ADL?
If a player loses all their chips, they must be removed from the table. But if no one wants to take over that seat, the HLP vault acts like the casino owner’s backup player, stepping in with its own money to keep the game running. ADL is a crisis-only mechanism, designed to protect solvency in extreme market conditions.
Hyperliquid activated cross-margin ADL for the first time in over 2 years amid Oct volatility—maintained 100% uptime, no bad debts. HLP pool absorbed positions, generating user profits while stabilizing the exchange. Key risk buffer in crypto perps.