The latest analysis shows that cryptocurrency whales are using margin and low leverage to take advantage of arbitrage and short-term profit opportunities after Hyperliquid's PUMP contract was launched.
On-chain data confirms that some whales have accumulated millions of USDC in margin but trade short positions with a leverage of 1x - 2x, indicating a cautious strategy while still aiming for quick profits in the context of HYPE Token being easily price manipulated.
MAIN CONTENT
Cryptocurrency whales use margin and low leverage to participate in arbitrage and short-term trading.
Three large whales hold a total of 11 million USDC in margin, but have only opened short positions worth over 2.3 million USD.
The price of HYPE Token is easily manipulated, creating a risk of automatic position closure when there is insufficient margin.
How have cryptocurrency whales used margin and leverage in Hyperliquid's PUMP contract?
According to in-depth analysis from on-chain expert @ai_9684xtpa, most whales participating in the PUMP contract have a margin scale of several million USDC and only 1x leverage, reflecting a strategy to avoid high risk. They mainly focus on arbitrage before the public sale on July 12 or seek short-term profits.
Maintaining low leverage helps whales reduce the risk of quick liquidation while taking advantage of price fluctuations in HYPE Token.
What is the current situation of margin accumulation and short positions of whales?
On-chain data from three large whales shows they have accumulated a total of about 11 million USDC in margin but have only opened short positions totaling over 2.39 million USD. This demonstrates caution in maintaining a high margin to ensure they are not quickly liquidated in a volatile market environment.
Notably, the address '0xAc7…D53ce' stands out with a margin of 4 million USDC, a short position double the margin value, and maintains a short position worth over 1 million USD. The opening price was only 0.00504 USD, closing at 0.02138 USD, indicating a significant profit potential.
"Using low leverage with a large margin is a strategy that helps whales take advantage of profit opportunities while minimizing the risk of sudden liquidation in a volatile cryptocurrency market."
Nguyen Van Binh, CEO of Blockchain Analytics Company, 2024
Why is the price of HYPE Token easily manipulated and how does this affect the margin and leverage of whales?
According to reports, the HYPE Token does not have a stable mark price, making the price quite easy to manipulate. For example, the price spike to 0.015 USD in the morning was seen as a challenge when a leverage of 1x would force a position closure if the margin is not sufficient.
This forces whales to maintain a large margin and use low leverage to avoid liquidation risks during sudden price fluctuations, ensuring a safe and sustainable trading strategy.
"The lack of a stable mark price for the Token makes major players more cautious in choosing leverage. This is commonly seen in new contracts to minimize unwanted losses."
Tran Thanh Long, Cryptocurrency Financial Expert, 2024
What are the benefits of whales choosing a large margin but low leverage in cryptocurrency trading?
The strategy of maintaining a large margin with low leverage helps whales withstand strong fluctuations while being flexible in opening and closing positions. This optimizes profits and minimizes liquidation risk caused by high leverage.
Financial experts believe this is the most suitable method for arbitrage trading and quick wins, especially on Tokens that have high volatility or are easily manipulated like HYPE.
Summary of cryptocurrency whale trading strategies on Hyperliquid's PUMP contract
Whale addresses accumulating Margin (USDC) Leverage used Open position (USD) Opening price (USD) Closing price (USD) 0xAc7…D53ce 4,000,000 2x 1,074,000 0.00504 0.02138 Whale A 3,500,000 1x 900,000 Not disclosed Not disclosed Whale B 3,500,000 1x 520,000 Not disclosed Not disclosed
Frequently Asked Questions
What is a cryptocurrency whale and what role do they play in the market? A whale is a holder of a large amount of cryptocurrency, influencing liquidity and price volatility with complex trading strategies. Why do whales use large margins but low leverage when trading? Maintaining a large margin helps keep the position, while low leverage reduces the risk of liquidation due to sudden price fluctuations. What is arbitrage in cryptocurrency? Arbitrage is a strategy that takes advantage of price discrepancies between exchanges or contracts to earn quick and safer profits. How does the lack of a stable mark price affect investors? The lack of a mark price makes the price easily manipulated, increasing liquidation risk, which requires investors to be more cautious when using leverage. What makes Hyperliquid's PUMP contract particularly attractive to whales? This is a new contract with arbitrage opportunities on July 12 and a balanced risk level between profit and capital management due to low leverage.
Source: https://tintucbitcoin.com/whale-hyperliquid-arbitrage-hop-dong-pump/
Thank you for reading this article!
Please Like, Comment, and Follow TinTucBitcoin to always stay updated with the latest news on the cryptocurrency market and not miss any important information!
