Ethereum News Update: The Dangers of Leverage: Crypto Whale Suffers $26 Million Loss Amid Market Decline

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Ethereum News Update: The Dangers of Leverage: Crypto Whale Suffers $26 Million Loss Amid Market Decline

Bitget-RWA2025/11/21 03:54

By:Bitget-RWA

- A crypto whale lost $26.348M by partially liquidating 15x leveraged BTC and 3x leveraged ETH positions amid declining prices. - The whale's $250M portfolio faces $3.734M unrealized losses if liquidated, with a $65,436 WBTC liquidation threshold. - Broader market trends show $260.66M ETH ETF outflows and ETH/BTC prices below $2,800 and $87,000, worsening leveraged traders' risks. - A HyperLiquid user lost $4.07M from a 6x ETH long position, reflecting systemic leverage challenges as macroeconomic factors

According to on-chain data, a prominent crypto whale has incurred a realized loss of $26.348 million over the past four months after partially closing out leveraged trades in

WBTC

and ETH,

as reported by blockchain analysts

. This development highlights the increasing instability in the crypto sector, with leveraged long positions coming under greater strain as asset values drop.

Ethereum News Update: The Dangers of Leverage: Crypto Whale Suffers $26 Million Loss Amid Market Decline image 0

This whale managed a portfolio valued at $250 million, holding 1,610.93

BTC

(with 15x leverage) and 19,894.21 ETH (at 3x leverage),

initially acquired at $108,043.9 per BTC and $4,037.43 per ETH

. However, recent moves to reduce leverage—such as sending 150 WBTC back to Binance—point to a shift in risk strategy,

with potential unrealized losses reaching $3.734 million if the positions are liquidated

. The whale currently holds 550.2 WBTC in

Aave

with a stablecoin debt of $28.09 million,

and faces liquidation if WBTC drops to $65,436

, illustrating the fragility of such leveraged trades.

In another case,

a HyperLiquid user lost $4.07 million

on a 6x leveraged ETH long, with an additional $6 million in unrealized losses, reflecting broader difficulties for those trading with leverage. These incidents mirror larger market patterns:

the U.S. spot Ethereum ETF recorded a net outflow of $260.66 million

, and ETH and BTC prices have fallen below $2,800 and $87,000, respectively.

The whale’s recent moves are part of a wider deleveraging trend in crypto. Between May and July 2025,

the whale withdrew 700.19 WBTC (valued at $81.63 million) from Binance

, at an average price of $116,593 per WBTC. The latest deposit of 150 WBTC back to Binance suggests a deliberate effort to cut risk, though

the position’s health factor of 1.4 means it remains exposed

to further price volatility.

Analysts point to ongoing downward pressure on crypto prices as the main reason for these losses.

The U.S. spot Bitcoin ETF also saw a net outflow of $904 million

, adding to investor concerns. At the same time,

macroeconomic issues—such as a higher-than-expected September unemployment rate of 4.4%

have led to a more cautious market mood.

This whale’s experience serves as a warning about the dangers of using leverage in a declining market. Although

the BTC and ETH trades initially reduced unrealized losses to $3.12 million

, the recent steps to reduce leverage and partial liquidations show a reversal in fortune as prices stay below key thresholds. Blockchain analysts caution that further drops in WBTC or ETH could set off a chain of liquidations,

especially for accounts with low health factors

Disclaimer: The content of this article solely reflects the author's opinion and does not represent the platform in any capacity. This article is not intended to serve as a reference for making investment decisions.

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