Recently, I saw some people claiming that the ADL mechanism would transfer your profits to the platform's insurance fund for free—for example, Hyperliquid's HLP pool.

This rumor has already been debunked by the official team. Hyperliquid co-founder Jeff specifically explained: ADL does not transfer users’ profits or losses to HLP, and it has absolutely nothing to do with any kind of secret liquidation.

Simply put, ADL is just a mechanism to balance long and short positions during extreme market conditions. Your profits will not be “confiscated.” What you earn is still yours, so don’t get swayed by FUD.

For those trading, you can rest assured that these basic mechanism designs are actually quite transparent. Of course, it’s still recommended to check the official documentation for the specific rules—after all, when it comes to fund security, you shouldn’t just take someone else’s word for it.