The crypto whale who opened more than 300 heavily leveraged short positions on Bitcoin, worth $521 million, closed these trades on Tuesday, netting him a total profit of $3.9 million.
The trades, completed on the Hyperliquid decentralized perpetual exchange, were facing resistance from traders who tried to pump Bitcoin above the whale’s short entry of $83,898.
Short trades make money when an asset’s price falls, but when using 40x leverage, a 2% gain on Bitcoin’s $85,591 would have wiped out the positions. In response, pseudonymous trader Cbb0fe rallied a group to put $10 million into Bitcoin to push its price above the whale’s liquidation point.
Bitcoin was still volatile, however, rising to $84,573 before falling back to $82,295. Realizing it had a golden opportunity, the whale closed all of its positions in two minutes – specifically, it covered 208.1 BTC worth of shorts.
The risk was too high, given that Hyperliquid allows leverage of up to 40x. The crossed position would have wiped out the whale’s entire portfolio.
On-chain analytics company Bubblemaps dismissed speculation that the whale had insider information, noting that there was no relevant news prior to the trade.
That whale had previously seen $285 million wiped out from Hyperliquid’s community-owned liquidity provider as a result of a $4 million bet on Ethereum. Hyperliquid responded by cutting the maximum leverage on Bitcoin and Ethereum.
Despite the risks, the whale has made $9.37 million in less than 30 days. However, the trader’s latest move was a $2.7 million long position in Melon, a Solana meme coin. Liquidation looms if the price drops by 9.78% - but so far no one has stepped in to oppose the position.
Post a Comment