A cryptocurrency whale account was liquidated with losses of millions of USD in a short time, reflecting high risks from large leverage orders in the market.
- Cryptocurrency whale liquidated over 19,556 ETH and 2,404 BTC, losing 3,855 million USD on the morning of 3/7.
- Total liquidation losses in 24 hours reached 10.75 million USD.
- The account currently holds a 40x short BTC and 25x short ETH position with a value of around 43.65 million USD.
How much was the cryptocurrency whale account liquidated this time?
The liquidation event occurred between 00:05 and 03:00 on 3/7 with a large amount of ETH and BTC being sold off, causing the account to lose around 3,855 million USD in value.
Information confirmed through monitoring data by expert Ai Yi, reflecting volatility and potential risks when trading with high leverage. This is one of the large liquidations in the past 24 hours, contributing to the account's total losses of 10.75 million USD.
"The liquidation of high-leverage positions like in this case is a clear evidence of strong volatility and high risk in the current cryptocurrency market."
Ai Yi, Cryptocurrency Monitoring Expert, 3/7/2024
What is the remaining position of the whale account after liquidation?
After the liquidation, the account still maintains a significant position with a total value of around 43.65 million USD, including 237.25 BTC and 6,948.14 ETH in short positions with leverage of 40x and 25x respectively.
The opening prices for these positions are 106,697.3 USD for BTC and 2,452.03 USD for ETH, indicating these are high-risk trading decisions that offer opportunities but also potentially large losses if prices move in the opposite direction.
Significance of high-leverage short positions for the cryptocurrency market
Shorting BTC and ETH with extremely high leverage can make price volatility more complex due to increased liquidation pressure. Especially for whale accounts, these movements can indirectly affect market liquidity and sentiment.
What are the lessons from this whale liquidation event?
This event emphasizes the importance of risk management and choosing appropriate leverage when participating in the cryptocurrency market. Experts always advise investors to avoid using too much leverage to reduce the risk of unexpected liquidation when prices fluctuate.
"The key to long-term survival in the cryptocurrency market is managing leverage ratios reasonably and always being prepared to counter volatility."
John Mayer, CEO of Cryptocurrency Financial Company, 2023
Frequently Asked Questions
- What is liquidation in cryptocurrency trading? Liquidation is when an exchange automatically closes a position when the account lacks sufficient capital to cover large losses, especially with high-leverage orders.
- Why can whales using high leverage be risky? High leverage increases potential profits but also quickly increases losses, easily leading to liquidation causing market volatility.
- Should beginners trade with leverage? New investors should limit or avoid using leverage to minimize the risk of capital loss due to significant price fluctuations.
- What is a short position and its impact? A short position is selling an asset expecting the price to drop, but when the price rises, it can lead to large losses, especially when using leverage.
- How to avoid account liquidation? Effective risk management, choosing moderate leverage, and regularly monitoring market fluctuations help reduce the risk of liquidation.
