In a dramatic example of the risks involved in high-leverage cryptocurrency trading, an $ETH whale (wallet: 0xcddf) has reportedly lost more than 90% of his portfolio—turning $2.96 million into just $250,000 within 48 hours. The events were analyzed by on-chain analyst Yujin, who detailed the sequence of rapid and high-risk trades.
The trader's losses began on May 18, when he opened a large short position on #Ethereum , betting against 41,851 $ETH at $2,514 using 25x leverage. With a narrow liquidation threshold of $2,525, the position left little room for market movement. soon #Ethereum rallied above that level, triggering a liquidation and resulting in a $2.46 million loss. Ironically, the price of $ETH dropped shortly after the liquidation occurred.
Undeterred, the trader quickly shifted strategy and went long on Bitcoin, placing a $17.6 million leveraged bet at $106,580 with 40x leverage. Unfortunately, the market again moved against him, and within 45 minutes, the position was liquidated, reducing his remaining funds to $250,000.
In a final attempt to recover, the trader opened another high-leverage short position on ETH at $2,444. This strategy—frequent directional flips under pressure—has been dubbed a “punching bag” approach by some traders, highlighting the dangers of emotionally driven decisions in volatile markets.
Key Lesson:
This incident serves as a stark reminder of the potential downsides of aggressive leverage in crypto trading. Emotional decision-making and lack of risk management can quickly lead to devastating outcomes.
Takeaway:
Develop a disciplined trading strategy, understand your risk tolerance, and avoid letting losses drive impulsive decisions.
