Disclaimer: Information found on CryptoreNews is those of writers quoted. It does not represent the opinions of CryptoreNews on whether to sell, buy or hold any investments. You are advised to conduct your own research before making any investment decisions. Use provided information at your own risk.
CryptoreNews covers fintech, blockchain and Bitcoin bringing you the latest crypto news and analyses on the future of money.
Kyle Samani, the recently exited co-founder of Multicoin Capital, has launched a fierce critique of the prominent Hyperliquid decentralized exchange (DEX), deeming it a systemic risk despite his former firm’s reported aggressive acquisition of its underlying HYPE token.
Key Takeaways:
- Kyle Samani publicly criticized Hyperliquid’s closed-source model just days after departing from Multicoin Capital.
- On-chain analysts indicate that Multicoin-associated wallets are holding over $40 million in HYPE tokens.
- Hyperliquid recently surpassed Coinbase in trading volume following the launch of its HIP-4 prediction market.
Why is Samani Targeting Hyperliquid Now?
Samani resigned from Multicoin Capital on February 5, 2026, concluding a decade-long career.
Only three days later, on February 8, he publicly criticized Hyperliquid, the largest DEX globally. His sharp remarks reveal a significant ideological divide within the industry, with Kyle advocating for permissionless open-source protocols, which he asserts Hyperliquid does not embody.
Hyperliquid is in most respects everything wrong with crypto
Founder literally fled his home country to build
Openly facilitates crime and terror
Closed source
Permissioned— Kyle Samani (@KyleSamani) February 8, 2026
Samani also suggests illicit or questionable activities associated with the exchange, claiming it facilitates “crime and terror,” although he incorrectly labels Hyperliquid founder Jeff Wan as an immigrant.
This ideological clash arises at a moment when capital flows are disregarding ideology; investors are channeling $258 million into crypto startups irrespective of technical decentralization, pursuing the substantial returns that high-performance applications are currently generating.
With an overwhelming array of features that provide it with some of the utility of a centralized exchange (CEX), Hyperliquid has experienced significant growth in recent months by emphasizing vertical integration and performance over open-source transparency.
“Walled Garden” or Market Leader?
Samani did not hold back, claiming that Hyperliquid “is in most respects everything wrong with crypto.”
Related Posts
His criticism specifically addresses the project’s closed-source framework and permissioned validator set.
He contends that this “walled garden” strategy, coupled with the founder’s decision to establish operations in the non-extradition jurisdiction of Singapore, poses unacceptable seizure risks.
Samani further alleged that the platform’s lack of transparency serves as a cover for potential illicit financial activities.
This rhetoric resonates with growing concerns regarding unregulated crypto platforms, a narrative recently highlighted when two high school students were charged in an Arizona home invasion aimed at $66 million in crypto, reminding the market of the darker aspects of extreme anonymity.
Despite Samani’s concerns, the market continues to respond positively. Hyperliquid recently surpassed Coinbase in trading volume, doubling the centralized exchange’s figures in early 2026.
BREAKING: Hyperliquid is quietly outgrowing Coinbase.
Trading Volume (Notional):
• Coinbase: $1.4T
• Hyperliquid: $2.6T
That’s nearly 2x Coinbase’s volume… from an onchain exchange. And the market is noticing.
YTD Price Performance:
• Hyperliquid: +31.7%
• Coinbase:… https://t.co/bqWcubvu7O pic.twitter.com/49IWNadjy4— Artemis (@artemis) February 9, 2026
With a market capitalization exceeding $7 billion, the HYPE token remains among the 20 largest cryptocurrencies and is considered one of the top cryptos for diversification. This situation recalls how the Post-Quantum QONE token sold out within 24 hours, indicating that traders prioritize cutting-edge technology narratives over social media disputes.
The $40 Million Contradiction
The timing of these remarks has also sparked speculation regarding internal conflicts at Multicoin.
A wallet believed to be associated with Multicoin was recently observed accumulating over $40 million in HYPE tokens. This presents a stark contradiction: the firm Samani established is heavily investing in the very asset he claims could jeopardize the industry.
A wallet I suspect to be @multicoin bought 1.355M HYPE ($40.8M) last week.https://t.co/MrJH7J1oeA
— MLM (@mlmabc) January 31, 2026
Samani’s response to the firm’s purchasing actions was straightforward: “I don’t work at multicoin.” Since his departure, he has expressed a desire to explore other technologies, but he announced he will continue as chair of Forward Industries, a Solana treasury.
Samani’s confrontation with Hyperliquid highlights the significant divisions still present in crypto as the industry awaits regulatory clarity from US lawmakers.
The post Kyle Samani Criticizes Hyperliquid in Explosive Post-Departure Market Commentary appeared first on Cryptonews.
