3 million leverages 200 million, whales' extreme short-selling game on HyperLiquid

2026-01-20 02:06:04

A whale used a principal of $3 million to open high-leverage short positions on BTC and ETH on the derivatives platform HyperLiquid, with unrealized gains approaching $2 million. What is the underlying trading logic behind this, and how much risk is hidden?

Whale’s Leverage Short Position Layout

According to on-chain data, this whale’s specific operations on HyperLiquid are as follows:

Asset	Short Position Size	Leverage Multiple	Nominal Value	Average Entry Price (Estimated)
BTC	1,073.5 coins	40x	$99.6 million	approximately $92,770
ETH	31,093 coins	25x	$99.38 million	approximately $319.7
XMR	Closed position	-	Profit of $221,000	-

Scale of Capital Leverage

This whale’s $3 million principal has leveraged nearly $200 million in nominal value. Specifically:

The BTC short’s nominal value is 332 times the principal
The ETH short’s nominal value is 331 times the principal
Total nominal value is about 66 times the principal

This extreme leverage configuration means the whale is engaging in massive market operations with a very small amount of capital.

Unrealized Gains and the Double-Edged Sword of Risk

Current Profit Status

As of January 20, the account’s floating profit reached $1.96 million, which indicates:

A floating profit rate of about 65% relative to the $3 million principal
If calculated based on the $22.1K profit from closing XMR, total gains have exceeded $2.18 million
The overall profitability of the account is quite impressive

Hidden Extreme Risks

The risks associated with ultra-high leverage trading are equally extreme:

40x leverage: A 2.5% drop in BTC price triggers liquidation
25x leverage: A 4% drop in ETH price triggers liquidation
Risk of principal depletion: If BTC drops more than 2.5% or ETH more than 4%, the account faces liquidation

This explains why such extreme operations, despite their attractive returns, are exclusive to high-risk traders.

What Does This Reflect?

Market Sentiment Signal

The whale establishing such large short positions at this time indicates:

A strong bearish outlook for the near future
Willingness to use extreme leverage to amplify potential gains from this outlook
Possibly betting on a recent pullback or correction

Trading Strategy Insights

The transformation from a $3 million principal to $1.96 million unrealized profit reflects a phenomenon in the derivatives market:

Professional traders (or large funds) tend to use high leverage to magnify returns
When the market direction is correctly identified, extreme leverage can generate rapid profits
However, this also means that a wrong judgment can lead to equally extreme losses

What to Watch for Next

Based on the current situation, the market should pay attention to:

BTC price trend: Continued upward movement will quickly increase the whale’s unrealized losses
Timing of closing positions: When the whale chooses to take profits may impact market liquidity
Risk management: Whether the account will add margin or close positions proactively when facing floating losses

Summary

This whale’s high-leverage short positions on HyperLiquid, with a principal of $3 million, have already generated $1.96 million in unrealized gains, demonstrating the profit potential of extreme trading. However, the 40x and 25x leverage multiples also mean that even small rebounds in BTC or ETH can trigger liquidation. This is not only a risk game for individual traders but also reflects the current sentiment among professional traders in the cryptocurrency market—bearish outlooks for the future. For ordinary investors, this serves more as a window into market sentiment rather than a model to imitate.

BTC-3,72%

ETH-7,15%

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