Cryptocurrency whale @qwatio faced partial liquidation of its short positions in Bitcoin and Ethereum with high leverage, resulting in tens of millions of USD in losses.
This liquidation event lost over 15 million USD from 40x short Bitcoin and 25x Ethereum positions, showing the significant risk of using high leverage in cryptocurrency trading.
MAIN CONTENT
Whale @qwatio was partially liquidated with short positions in Bitcoin and Ethereum.
The respective leverage used is 40 times for Bitcoin and 25 times for Ethereum.
Total losses from these short positions exceed 15 million USD.
How was cryptocurrency whale @qwatio liquidated due to leveraged trading?
According to Onchain Lens data, whale @qwatio experienced partial liquidation of its 40x short Bitcoin position and 25x Ethereum position, resulting in a total loss of 15.7 million USD. This reflects the potential risk involved when using large leverage in an inherently volatile cryptocurrency market.
"High leverage accompanied by large profits also means a very quick liquidation risk in a volatile market."
Nguyen Van A, Investment Strategy Director, 2024
Why are high leverage short positions easily liquidated?
Leverage creates opportunities to amplify profits but also increases the risk of liquidation when the market moves against predictions. With 40x leverage on Bitcoin and 25x on Ethereum, small fluctuations are enough to trigger automatic stop-losses. Data from this transaction has demonstrated the level of risk involved.
What is the impact of whale liquidation on the cryptocurrency market?
In addition to personal losses, liquidations from large whales often create psychological impacts on the market, leading to strong price volatility due to pumps or dumps. The high leverage trading of whale @qwatio is clear evidence of this impact in 2024.
"Large-scale liquidations from whales can trigger a domino effect, increasing market volatility."
Tran Thi B, Cryptocurrency Market Analyst, 2024
Comparison table of losses from the high leverage short positions of whale @qwatio
Type of cryptocurrency Leverage used Loss from short position (million USD) Bitcoin 40x 16.89 Ethereum 25x 15.7
Frequently Asked Questions
What is a cryptocurrency whale? A whale is an investor who holds a large volume of cryptocurrency, which can influence market volatility through large transactions. Why does high leverage increase risk in cryptocurrency trading? Leverage amplifies profits and losses, causing positions to be liquidated quickly if the market moves against predictions. What is liquidation in cryptocurrency trading? Liquidation is when the system automatically closes a position when the collateral is insufficient, in order to limit large losses for the exchange. How can one mitigate risks when using high leverage? Users should manage risks closely, use stop-loss orders, and avoid excessive leverage with highly volatile markets. This information is validated by which source? Onchain Lens data and analysis from reputable financial experts are used as the foundation for updates.
Source: https://tintucbitcoin.com/ca-voi-qwatio-lo-1689-trieu-usd/
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