A crypto whale that opened over 300 heavily leveraged short positions on Bitcoin, totaling more than $521 million, closed the shorts on Tuesday and pocketed a profit of $3.9 million. This green trade was made despite a platoon of crypto traders looking to wreck the whale’s position, seeking to boost the price of Bitcoin above the liquidation level.

A short trade is a bet that an asset’s price will drop; the lower it goes, the more money the trader makes. In this scenario, the whale had placed a short trade on Bitcoin that sat at $83,898—and with 40x leverage applied, the total trade surged to a value of more than $521 million. If Bitcoin had risen just 2% from the trade’s open to $85,591, then the whale’s position would have been liquidated.

Hearing this, some crypto degens went after the whale as pseudonymous trader Cbb0fe organized a group to pump over $10 million into Bitcoin, in an attempt to raise the price of the asset above the whale's liquidation mark.

That’s a tiny sliver of Bitcoin’s typical daily trading volume—which sits at about $25 billion over the past day. As is often the case, the leading cryptocurrency had a fairly volatile day Monday, peaking at $84,573 according to CoinGecko but eventually stooping to $82,295. 

Following this daily low, the whale sold his 300+ heavily leveraged short positions in less than two minutes, according to the HypurrScan block explorer. In total, 208.1 BTC worth of shorts were closed, valued just shy of $16,959,000. According to on-chain analytics company Bubblemaps, the margin required for the whale to open the trade was approximately $13.027 million. 

“Shorter closed,” Cbb0fe said on X, formerly Twitter. “We lost the war, but it's been a long time since we had this much fun on the internet. [Good game] to the shorter for the win.”

This means that the whale made a 30% profit on the trade and pocketed $3.932 million. However, the risk involved was much higher than this.

Hyperliquid allows users to place leveraged trades of up to 40x through its decentralized perpetuals exchange, which utilizes its own layer-1 blockchain to process transactions. In this case, the whale opened a cross position which would have used the wallet’s other positions to cover any losses made—meaning the whale’s portfolio could have mostly been wiped out through one trade.

BitcoinBTC · USD
$80,420−1.08%
08:30 AM02:30 PM08:30 PM02:15 AM08:15 AM
$81.9k$81.4k$80.8k$80.2k
24h HighHigh$81,864
24h LowLow$80,187
VolVol$1.0B
Market projectionsOdds by Myriad
Today$80,000 to $82,000$80k–$82k82% chance
Price data by CoinGeckoCoinGeckoMore Bitcoin news and projections →

Due to the hugely risky bet, however, many observers believed that the whale must have been an insider of some kind. But, Bubblemaps told Decrypt this is unlikely due to the lack of news that happened before or after the wallet exited its position. 

That same trader caused a $4 million loss for the community-owned Hyperliquidity Provider (HLP) last week, as it was forced to cover the losses of the whale's $285 million leveraged bet on Ethereum. As a result, Hyperliquid lowered the maximum amount of leverage a trader can apply on Bitcoin and Ethereum following the detrimental 50x leveraged trade.

While the whale has been making headlines and stealing social media attention with its risky bets, the wallet has profited over $9.37 million in less than 30 days since creating the account.

And the whale has already made a fresh bet: a long position on MELANIA, the official Solana meme coin of U.S. first lady Melania Trump, totaling $2.7 million with 5x leverage applied. If the Solana meme coin falls just 9.78% from $0.7238 to $0.653, then the whale’s position will be liquidated. 

As of this writing, there's no sign of traders trying to hunt this position to force a liquidation.

Edited by Andrew Hayward

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