The $11 billion Bitcoin whale has returned with another significant short position, indicating that large investors are preparing for further downturns in the crypto market amidst tariff concerns and an ongoing government shutdown.
This Bitcoin whale, a term used in the crypto world for significant investors, re-emerged with a $235 million 10-times leveraged short position on Bitcoin (BTC), essentially betting on the price drop of the leading cryptocurrency.
The investor initiated the short position on Monday while Bitcoin was trading at $111,190. Currently, he is facing a $2.6 million unrealized loss on the short position, which could be liquidated if Bitcoin’s price exceeds $112,368, as per data from Hypurrscan blockchain data.
This new short bet follows a week after the same whale gained approximately $200 million from a previous crash in the crypto market through a similar leveraged short position.
Leverage in trading refers to a strategy enabling investors to open larger positions than their actual holdings by borrowing capital. While this can amplify potential gains, it also increases downside risks, which may result in the total loss of the investment.
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“The whale who profited $200M from shorting the Bitcoin crash to $100K has now transferred $30M to Hyperliquid and is shorting AGAIN,” stated blockchain data platform Arkham in a post on Monday on X post.
The whale also moved $540 million in Bitcoin to new wallets, including $220 million to Coinbase exchange’s wallets, over the last week.
The $11 billion Bitcoin whale surfaced two months ago and shifted about $5 billion worth of BTC into Ether (ETH), briefly outpacing the second-largest corporate treasury, Sharplink, regarding total ETH holdings, as reported by Cointelegraph on Sept. 1.
Significant selling from previously dormant Bitcoin whales was identified as one of the primary factors constraining Bitcoin’s price movements in August, according to analyst and early Bitcoin adopter Willy Woo.
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New Bitcoin whales face $6.95 billion in unrealized losses after crypto market crash
In the meantime, new Bitcoin whales are currently dealing with a collective unrealized loss exceeding $6.95 billion after the recent crypto market collapse drove Bitcoin below the crucial $113,000 threshold.
“Bitcoin is trading below its average cost basis of ~$113K, which translates to $6.95B in unrealized losses, the largest since October 2023,” reported the crypto analytics platform CryptoQuant in a post on X, noting that this group “holds ~45% of the total Whale Realized Cap.”
Despite declining investor sentiment, analysts observed that Bitcoin’s four-day drop to $104,000 was a healthy correction that eliminated excess leverage, leading to more cautious positioning among market participants.
At the same time, the supply of short-term Bitcoin holders has increased, indicating that “speculative capital” is now capturing a larger proportion of the market, as reported by blockchain analytics firm Glassnode in a report issued on Tuesday.
Magazine: Sharplink exec astonished by the level of BTC and ETH ETF holdings — Joseph Chalom
