Tak🎒

Web3 Wanderer | NFT Admirer | @MadLads | Surf Aficionado 🌊 | Camping Connoisseur ⛺ | Designer

[Bullet @Bulletxyz]

Perps Trading on Solana is about to change for the better.

Mainnet is live.

Here's how you can get in early 👇

[Bullet @Bulletxyz]

12.02.2026

Fire with Bullet.

[Bullet @Bulletxyz]

New beginnings.

[Bullet @Bulletxyz]

https://t.co/qFHWTcZ2QP

[Bullet @Bulletxyz]

gBullet

Is it time for $BTC to recover or will it retrace below $80k? 👀

[Bullet @Bulletxyz]

Catch up with BULLET Co-Founders @PDAnimol and @Tristan0x, November 25th at 9am EST- right here on X.🎙️

Coming to you live from BULLET city🏙️

[Bullet @Bulletxyz]

Stay tuned for our founders livestream which will start a bit later than scheduled at 9:15AM ET 🔥

[Bullet @Bulletxyz]

Live from BULLET City https://t.co/idZAbTQip4

[Bullet @Bulletxyz]

The side event at Solana Breakpoint that can't be missed.

Trading Lounge, 11th December.

Big things to happen. 👇

[Bullet @Bulletxyz]

https://t.co/idZAbTPKzw

[Bullet @Bulletxyz]

gBullet

Are we excited for what is to come?

[Bullet @Bulletxyz]

We agreed that our previous version of an exchange was not the best.

We made the changes necessary and stuck around during tough times.

And now we are coming.

Fire with Bullet

[Bullet @Bulletxyz]

See you at the lounge @SolanaConf.

December 11th.

Link below 👇

[Bullet @Bulletxyz]

START.

[Bullet @Bulletxyz]

Will you play?

[Tristan @Tristan0x]

Many things intentionally misleading/dramatic with this post. Here’s what OP doesn’t fully understand about running a perps exchange:

1. Users Are Only Solvent If The Protocol Is Solvent

OP frames "protecting the protocol vs. protecting traders" as two objectives at odds with one another. But perps are zero sum games, and unlike spot, due to the existence of leverage, your system can go bankrupt. Liquidations and ADL are the current best mechanism we have to mathematically guarantee solvency, and by extension protect the userbase as a whole.

Once your insurance fund is depleted, without ADL, your options are largely:

1. Protocol goes insolvent (more losses than collateral on the exchange). Everyone takes a huge haircut (hello Drift V1 users).
2. Protocol covers losses with treasury, creating an FTX-FTT death spiral where protocol tokens are dumped to cover debts (imagine if we had an additional HYPE selling cascade)
3. Underwater accounts are systematically de-risked by reducing profitable positions of their counterparties. Protocol stays operational and funds can be withdrawn.

Your unrealized PnL is not real money until it can be withdrawn (hence unrealized).
Traders who were smart settled and withdrew millions on their Luna shorts on Drift V1, leaving the rest of the userbase looking at their imaginary UPnL on their screen. This rush for the exits resulted over 60% of Drift’s TVL leaving within the first 12 hours. Timely liquidations and ADL would have flattened those underwater longs well ahead of time and prevented mass insolvency, even being flagged in their own post-mortem.

2. Disabling Liquidations: The Thanksgiving Turkey

Halt liquidations if “the oracle price diverges by more than 50% from the 5-minute TWAP?”

This is all well and good in the 99% of times that prices mean revert, but what about the 1% in which they don’t?

Turns out this already happened, and yes again in Drift V1 (PnL chart attached above).

During the Luna collapse in May 2022, the price off LUNA crashed from $63 on May 9th to around $8-10 on May 11th by the time Drift paused trading (a roughly 85% drop). By the time they had force settled all markets ("terminal settlement") on May 12th, Luna had fallen another 96% to $0.0003. In the end, traders lost around $20m (that we know of).

Don't get me wrong, while I am in favour of avoiding scam wicks from short term, artificial price manipulation with circuit breakers, you run the risk of assuming that every asset will eventually bounce.

As @shuri2060_defi correctly notes: "you are potentially delaying the inevitable and essentially leveraging the entire exchange praying the price bounces back. Yes it protects against temporary price movements/manipulations, but it undermines the entire point of a liquidation system which is to keep the exchange solvent."

Or as @richard_isc puts it more bluntly: "Not having ADL isn't a feature. There are price changes where there is no counterparty big enough to take on the position. Not force closing the position is gambling with everyone's money, betting it all that price will revert. Good for flash crash, death in actual crash."

OP will no doubt argue that it succeeded to remain solvent, but failed to protect from a retraced wick. The crux of the problem is that Binance made a gross error in their mark pricing, relying too much on their local orderbooks and not the market at large. @HyperliquidX acted swiftly and decisively to mitigate further damage to their platform. This is the first time ADL has been triggered in 2 years of operation, a <1% occurrence, not unlike our turkey friend, however Hyperliquid remains alive and well today.

In the heat of the moment who can say if it’s a temporary blip, or the next Luna? One thing is clear, that mark prices need to rely on a diverse pricing index (which HL already had) and the industry needs to mature to a place where it isn’t majorly reliant on a single exchange like Binance for liquidity measures.

3. No Obligation To Protect Extreme Risk-takers

Let's be very direct here: If you're using high leverage going into events like October 10's tariff announcement, you're effectively gambling, not trading. 87% of the $19 billion liquidated came from long positions at approximately a 7:1 ratio of longs to shorts, the market was full of dry powder due to excessive leverage.

The exchange tells you your entry price, liquidation price, margin requirements, and possible ADL queue position. If you lever up 20x, you're explicitly accepting that a 5% adverse move wipes you out.

OP was clearly running back his own James Wynn playbook and taking outsized and highly leveraged positions on SOL and other coins, and complaining when he got blown out.

https://t.co/r6O3ni5yOO

He references "lives ended" and "families destroyed". I have sympathy for them, but anyone exercising proper risk management wouldn’t have put themselves in such a risky position in the first place. Blaming liquidations for over-leveraged losses is like blaming seatbelts for car accident injuries. All long-term successful traders use leverage sparingly.

4. How TradFi Actually Works (And Why Crypto Can't Copy It)

OP states "TradFi has structural guardrails. Crypto has hope." Let's talk about what TradFi actually has.

When a CME clearing member defaults, after exhausting the defaulter's capital and CME's own $100-150M contribution, losses are covered by the guaranty fund - the mutualized resources of non-defaulting clearing members (i.e. loss is socialized amongst solvent parties).
https://t.co/ZZM3rhAFD6

Furthermore, they have the added benefits of:

1. Known, Vetted Counterparties: In traditional finance, clearinghouses only work with large, regulated institutions like banks and trading firms. They know who these members are, verify they have enough capital, and can sue them if they don't pay up. In crypto, you cannot assess creditworthiness or collect capital from pseudonymous wallets.
2. Multi-Day Settlement: CME provides 24 hours' notice for margin changes. Equity markets allow up to seven business days for maintenance margin payments. Crypto operates 24/7 with millisecond timeframe liquidations.
3. Legal Enforcement: Losses remain legal obligations. Clearinghouses pursue recovery through bankruptcy proceedings. You can't sue a crypto wallet.
4. Regulatory Backstops: Central bank access, government oversight, implicit "too big to fail" guarantees. Crypto has none of these safety nets (perhaps one day).

However DeFi must deal with risk systematically.

In a permissionless system where you cannot verify counterparties, enforce capital calls, pursue legal recovery, prevent capital flight, or access regulatory backstops, you must have real-time, automatic loss allocation that doesn't depend purely on external capital. Furthermore, we’re dealing with a far more volatile assets class, and many platforms extending orders of magnitude more leverage.
This is why liquidations and ADL are a necessary evil. It's not a design flaw, and Jeff and many others before him are not bad actors or idiots. It's an invariant, a mathematical solution to operating derivatives in the absence of TradFi's institutional infrastructure.

All in all, my point stands that permissionless protocols should be designed to prioritize solvency and stay alive at all costs, which in the long run is in the best interests of its users. This is the reason why DeFi lending protocols survived during the FTX meltdown by acting out their strict liquidation rules, while centralized lenders who relied on trust and de-risked either too slowly or not at all, went under. Warehousing that risk on behalf of users is potentially gambling with their money if shit hits the fan. It's happened many times, and it will happen again.

To that end, we will be doing a lot more research into better risk mitigation designs in the coming weeks and months, it's a very hard problem. I'm personally very glad things like this are being discussed publicly and looking forward to see what teams come up with.

P.S. Not unlikely that OP had financial motives to tweet given he's been posting Drift referral links. Always take these "KOLs" with a grain of salt and DYOR.

[Bullet @Bulletxyz]

The time has come.

[Bullet @Bulletxyz]

Locking in.

[Bullet @Bulletxyz]

something new on Solana is about to break the speed limit.

[Bullet @Bulletxyz]

The new world.