Papertrade loses $1.28 million on launch day: the reference price came from Hyperliquid

A new trading venue lost roughly $1.28 million from its own liquidity pool within eight hours on October 10, 2026, and nobody had to find a security hole in its code to do it. Moving the price the platform used to settle its trades was enough. The Papertrade case shows how sensitive leverage of 1,000 becomes once the reference price comes from outside and the capital behind it is thin.