Hyperliquid-type DEX contract platforms may cause the collapse of ETH!
Recently, Hyperliquid's liquidity pool decreased by 1 million USDT due to a whale who was long on ETH. Due to insufficient counterparty liquidity, they had to close their position through a forced liquidation, resulting in their long position being unable to realize profits. Therefore, they chose to withdraw the margin and forcefully close their position.
In this cycle, ETH has performed poorly, and many whales hold large amounts of ETH but have minimal returns, or even losses, so they chose to open contracts on Hyperliquid.
In this case, even if this whale managed to profit from a long position on ETH, they still couldn't realize their profits due to insufficient counterparty liquidity. The whale was also worried about further declines leading to losses, so they opted to withdraw the margin to forcefully close their order. (If ETH drops further, it may result in greater losses)
In this situation, since this whale's position was excessively large at 160,000 ETH, the forced liquidation occurred at market price, leading to a transaction price that was far below the current ETH price.
Ultimately, they exited with losses, which also dragged down the price of ETH!
The whale's counterpart trader is indeed impressive!
It's very difficult for ETH to realize good returns in this cycle!
