A Hyperliquid trader reported their wallet was flagged as high risk after receiving a loan repayment from a friend who used HTX, formerly known as Huobi. The trader said they had never used HTX and were unaware of the exchange's sanctions issues at the time.
In an October 25 post on X, the trader known as x256.hl described lending a friend several thousand dollars months earlier. When the friend repaid the loan using funds from HTX, the trader's Hyperliquid wallet was subsequently flagged. The trader noted their friend also did not know about any sanctions problems with the exchange.
Other Users Report Similar Issues
Another Hyperliquid user, @0xasrequired, reported facing comparable restrictions after interacting with HTX. According to their account, three of their wallets were blocked from Hyperliquid's official frontend in June, holding approximately 99.5% of their net worth. The user said their Hyperliquid trading history included over $210 million in volume and $110,000 in combined trading and builder fees.
While the trader could still access Hyperliquid through alternative interfaces, the official frontend restriction prevented them from signing terms required for future airdrop claims. The user reported being unable to claim Kinetiq Season 2 rewards despite ranking in the top 150.
UK Sanctions Trigger Broader Screening
The wallet restrictions stem from May 26, when the United Kingdom sanctioned Huobi Global S.A., accusing the company of providing financial services linked to Russia-connected entities. HTX argued the sanctions did not apply to its exchange as a separate legal entity, but UK officials later stated HTX was covered under ownership rules.
Following the sanctions, multiple platforms implemented HTX-related restrictions. In June, FixedFloat held Huobi-linked funds for additional checks, while Kraken and OKX warned users about HTX transfers. Binance announced transaction limits involving HTX and 10 other platforms in August.
Screening Provider Role Unclear
Traders reported that screening firms such as Chainalysis, Blockaid, and TRM Labs supply risk scores to platforms, which then decide which wallets to restrict. One affected user claimed Hyperliquid uses Chainalysis for screening, though this has not been independently verified.
In one case, a Hyperliquid user said their wallet passed security checks from GoPlus Security and Blockaid but was still restricted on Hyperliquid. Another trader reported their wallet was wrongly flagged after receiving a $0.02 transfer tied to a suspicious address, though their access was later restored.
Hyperliquid has not publicly disclosed which specific transactions or screening criteria triggered the wallet restrictions. One affected user opened a Discord support ticket that received an initial response from Hyperliquid co-founder iliensinc, but no final resolution has been reported.
