Most retail traders don’t realize that the game top traders play is very different from the one they think they’re copying.
A Recent example is James Wynn, a so-called top trader who publicly showed a $30 million+ loss on Hyperliquid in just a few days. First, he opened a long position and the market dropped, causing a ~$14M loss. Then, he flipped short, and the market went up, leading to another ~$15M loss. To an average trader, this looks like poor decision making or bad luck but in the world of insiders, it’s often the opposite. These kinds of trades aren’t always about making profit from price direction. Sometimes, they’re strategic plays designed to manipulate market psychology, generate massive volume, and extract hidden rewards that most people don’t even see.
In the background, whales like James might be profiting from funding rate arbitrage. In perpetual futures, when funding is positive, short traders get paid by longs and when you’re holding billion-dollar positions, even small hourly rates can generate hundreds of thousands of dollars in passive income. So while the position shows a loss, the real alpha is in holding and farming the funding. On top of that, these traders understand how to weaponize liquidation engines. By publicly opening a large position and allowing followers to copy them (Either manually or via leaderboards), they trigger a wave of copy trades.
Then, using either hidden wallets or through coordinated moves, they push the market in the opposite direction, forcing massive retail liquidations. The public wallet shows a loss, but the private wallet or even a group of insider wallets books the actual profit. It’s a liquidation trap disguised as a transparent trade.
Also Some of these whales have Revenue-sharing deals with exchanges. They’re paid not for winning trades, but for generating volume.
Every time retail gets rekt, the exchange earns fees — and the whale earns a cut of those fees through rebates or backdoor profit-share models. In such deals, losses are just expenses marketing costs, if you will to create volume, build credibility, and bait retail into the meat grinder. It’s no surprise that while the trader “loses” $30M publicly, exchanges like Hyperliquid hit all-time-high revenues.
Remember, the market isn’t just a battle of longs vs shorts it’s a game of predators vs participants so Play accordingly.