Kyle Samani, the former managing partner of Multicoin Capital, has launched a scathing public critique of the decentralized perpetual futures exchange Hyperliquid, labeling it a symbol of structural and ethical failures in the crypto industry. Samani, who stepped down from Multicoin on February 5, 2026, and now serves as Chairman of Forward Industries, made the accusations in a now-deleted social media post on February 8.
Samani's criticism focused on several core issues. He alleged that Hyperliquid's founders deliberately relocated abroad to avoid regulatory scrutiny and that the platform facilitates illicit financial activities, including criminal and terrorist-related transactions, though no formal enforcement action has been announced. He also attacked the platform's fundamental design, pointing to its closed-source codebase and permissioned access controls as being fundamentally at odds with the principles of decentralization and open finance.
The timing of the criticism is notable, coming just days after on-chain analysts flagged wallets believed to be linked to Multicoin Capital accumulating over $40 million worth of Hyperliquid's native HYPE token in late January 2026. This has fueled speculation that Samani's departure may have been influenced by internal conflicts over investment strategy, contrasting Multicoin's recent HYPE accumulation with Samani's stated philosophical shift away from the "Web3 and dApp" narrative toward a focus on base-layer assets like Solana.
Despite the high-profile criticism, the HYPE token's market performance has shown resilience. The token rose approximately 6% in early February 2026, supported by reports of growing institutional usage and new integrations. Supporters of Hyperliquid defended the platform, highlighting its rejection of venture capital, its model of democratizing market making via its HLP program, and its commitment to directing revenue—reportedly $960 million—toward token buybacks and community incentives, including what they call the largest token airdrop ever at $9 billion.
The event has ignited a broader ideological debate within crypto, pitting principles of transparency and decentralization against the pursuit of performance, liquidity, and institutional-grade infrastructure. While the direct impact on HYPE's price has been muted so far, the controversy underscores growing tensions as the industry matures and faces increased regulatory pressure.
