The Chopping Block: Hyperliquid vs. Tarun, ADL Transparency & The Coming Perps Arms Race - Ep. 981

Unchained

Laura Shin

News, Tech News, Business News

4.6 • 1.3K Ratings

🗓️ 17 December 2025

⏱️ 66 minutes

🔗️ Recording | iTunes | RSS

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Summary

Welcome to The Chopping Block — where crypto insiders Haseeb Qureshi, Tom Schmidt, Tarun Chitra, and Robert Leshner chop it up about the latest in crypto. This episode features special guest Vladimir Novakovski, Founder of Lighter, joining the crew to unpack the fallout from October 10’s historic perpetuals liquidation event and the ADL research that sparked a public clash with Hyperliquid. The panel digs into how auto-deleveraging really works, why these failures were long hidden inside centralized exchanges, and what decentralized perps must fix to truly outperform TradFi. The conversation then turns to the intensifying perp wars. With Lighter’s zero-fee trading model, premium tiers for pros, and a looming token launch, the hosts debate whether crypto is headed for a Robinhood-style fee reset, why TVL may matter more than volume, and how RWAs, FX perps, and cross-margining are reshaping market structure. Finally, they tackle the growing divide between tokens and equity as devcos get acquired and tokenholders are left behind. Perps are evolving, incentives are breaking — let’s get into it. Show Highlights 🔹 ADL research ignites a firestorm — Tarun’s paper on auto-deleveraging sparks a public clash with Hyperliquid and Paradigm, exposing how opaque ADL systems really are. 🔹 October 10 liquidation shock — Repeated ADLs during crypto’s largest liquidation day reveal structural fragility long hidden inside both CEXs and DEXs. 🔹 Fairness vs predictability in perps — Why traders care less about perfect algorithms and more about knowing when and how ADLs will hit. 🔹 Lighter’s design tradeoffs — Vladimir Novakovski explains Lighter’s less-aggressive ADL approach, insurance fund buffers, and trader-friendly risk parameters. 🔹 Zero-fee perps debate — Lighter’s free retail tier + paid pro tier raises the question: is crypto headed for a Robinhood-style fee reset? 🔹 TVL beats volume — The panel argues TVL is the most honest signal of trust in perp exchanges, especially during market stress. 🔹 RWAs and FX perps surprise — Euro and index perps outperform expectations, challenging assumptions about which real-world assets actually trade onchain. 🔹 Tokens vs equity explode — Devco acquihires (Axelar, Tensor) leave tokenholders behind, reigniting debates over incentive alignment and crypto M&A. Hosts: ⭐️Haseeb Qureshi, Managing Partner at Dragonfly ⭐️Tarun Chitra, Managing Partner at Robot Ventures Guest ⭐️Vladimir Novakovski, Founder & CEO. Lighter. Links: Tarun Chitra’s Autodeleveraging: $653 million lost to a greedy heuristic? 🔗 https://x.com/kenchangh/status/1994854381267947640 ⁠Disclosures⁠ Timestamps 00:00 Intro 01:38 Tarun’s ADL Paper Sparks Backlash 05:24 Research vs Bag Defense 06:27 How ADLs Actually Work 12:27 Fairness vs Predictability 24:14 Tarun’s Inspiration 28:17 Zero-Fee Perps Explained 34:12 Perp Wars Heat Up 38:15 RWAs Trade Onchain 41:49 Token Launch Reality 47:19 Tokens vs Equity Clash Learn more about your ad choices. Visit megaphone.fm/adchoices

Transcript

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0:00.0	The goal of decentralized exchanges is to improve upon centralized exchanges. And one thing is a lot of people who worked at centralized exchanges DM me and said, like, hey, these ADL, like, repeated events have happened before at centralized exchanges. But no one knew because you can't really see it, right? There's no public data. You only see yourself getting ADL. You don't see other people, so you can't measure, like, how big of an event it is. Not a dividend. It's a tale of two fun. Now, your losses are on someone else's balance. Generally speaking, air drops are kind of pointless anyways. Unnamed to trading firms who are very involved. D5.Eat is the ultimate policy. D5 protocols are the antidote to this problem.
0:55.1	Hello, everybody. Welcome to the chopping block. Every couple weeks, the four of us get together and give the industry insider's perspective on the cryptot topics of the day. So quick intros. First, you got Tom, the D5 Maven and Master of Memes. Hello, everybody. Tom is at a party. Apparently, he was too cool to show up on time. next we get to Rune,
0:57.3	the giga brain and Grand Puba at Cotlet.
0:57.3	Yeah. Tom is at a party. Apparently, he was too cool to show up on time. Next, we get to Rune, the Gig of Brain, and Grand Puba at Contlet.
0:58.5	Yeah.
1:05.1	And joining us today, we've got special guest, Vlad, Leverage Legend and Leader of Lighter.
1:06.7	Welcome back to the show, Vlad.
1:07.8	Wow. You guys, you're good to join for the late-night session.
1:10.6	That's right. That's right.
1:11.1	That's right.
1:12.1	Actually, it is very late at night right now. And I was see the headhike man at Dragonfly. We are early stage investors in crypto, but I want to caveat that nothing we say here is investment advice, legal advice, or even life advice. Please see Chopping Block that X, Y, for more disclosures. So, welcome to the late night version of Chopping Block, brought to you by the chopping block crew.
1:30.0	So we brought Vlad on the show. more disclosures. So welcome to the late night version of Chopping Block, brought to you by the
1:28.9	chopping block crew. So we brought Vlad on the show today because there's been a lot of drama
1:33.4	going on in Perpsland specifically. So right at the end of the last show, we were actually running
1:39.4	up on time and we got some angry letters from our viewers that we gave very short shrift to Tarun's ADL paper.
1:47.1	So Tarun had just recently released a paper on ADL.
1:49.4	ADL stands for auto-de-leveraging.
1:51.4	This is a process that happens when basically a market is moving really crazy fast in a
1:56.0	perps market, and it must forcibly close out positions in order to de-leverage the market.
2:00.8	This is called auto-de-leveraging.
2:02.4	And it's a very edge-casey kind of thing.
2:05.0	But of course, it happened repeatedly across many, many different venues on October 10th,
	...

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