- A Bitcoin whale placed a $520 million short trade on Hyperliquid using 40x leverage, with a liquidation price of $85,561.
- Traders noticed the opportunity and pushed BTC’s price up by 2.5%, nearly triggering the liquidation before the whale added more funds.
- Some analysts believe the whale might be using a rare “self-liquidation” strategy to drive Bitcoin’s price higher and benefit from a larger long position.
One Bitcoin whale opened an enormous $520 million short on Hyperliquid via 40x leverage on March 16. Its liquidation point was at $85,561, or should BTC gain an additional 1.75% from its initial price of $83,898, it will be automatically washed out.
Traders Push Bitcoin Higher
This was noticed by traders who identified the opportunity to drive the price of Btc higher and initiate the liquidation. Quickly, the price of BTC moved up by 2.5%, just short of the whale’s level before they increased their funds to increase their liquidation price.
As per 10x Research, analyst Markus Thielen commented that this incident is a demonstration of an increasing trend where standalone traders organize to dictate the market.
Earlier, institutions used to do stop-loss hunting primarily, but decentralized exchanges make it possible for ordinary traders to monitor large leveraged positions and respond accordingly.
Possible Market Manipulation
Other analysts think that the whale’s trade could have been a deliberate action instead of a risk by mistake. Cryptocurrency analyst Josh Man opined that the whale could be employing a rare strategy known as “self-liquidation.”
If the whale has a bigger long position somewhere else, compelling their own short liquidation could drive the price of Bitcoin up, which would favor their long position. This is a rare tactic but can be employed to manipulate price movements.
This is not the first high-leverage trade on Hyperliquid. Previously, a trader bet $285 million of Ethereum in leveraged form, leading to a $4 million loss for the platform. To address this, Hyperliquid resolved to reduce leverage limits for Ethereum and Bitcoin in order to keep risk in check and avoid undue volatility.
The cryptocurrency community is now monitoring the price action of Bitcoin closely since additional increases might take place if the short position of the whale gets liquidated.
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