A preprint study reveals that Hyperliquid diverted $576 million of forced sales to its backstop during the worst minute of the October 2025 crypto crash, preventing a systemic collapse. Approximately $576 million out of $641 million in forced sales were absorbed off the public order book, representing 62.6% of total volume. This backstop mechanism interrupted the feedback loop that propagates cascading liquidations by absorbing orders within the venue. The branching ratio measuring liquidation propagation stayed below 0.2 within the venue. However, potential broader market effects remain untested.
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