Hyperliquid HLP has suffered a $1.2 million loss after taking over large long positions in Fartcoin, which were suspected to be manipulated by malicious actors. The positions, now closed, resulted in a drawdown of approximately 0.35%. According to on-chain analyst 0xMacroGuy, the attackers established large leveraged positions in the low-liquidity asset, deliberately pushed them into loss, and triggered liquidation. This forced Hyperliquid HLPs to absorb the losses and inherit the toxic positions along with associated bad debt. The incident highlights vulnerabilities in handling low-liquidity assets and the risks of automated liquidation processes. Hyperliquid's Vault currently reports a total value locked (TVL) of $420 million, with a 0% annual percentage rate (APR) over the past month, reflecting the impact of the recent losses.