AguilaTrades Loses $35 Million in Two Weeks Due to Poor Risk Management

A prominent cryptocurrency trader, AguilaTrades, has recently experienced a significant financial setback, losing over $35 million in the past two weeks. This substantial loss has drawn attention to the volatile nature of the cryptocurrency market and the risks associated with large-scale trading. The transactions and critical mistakes that led to this loss highlight the importance of careful risk management and strategic decision-making in the cryptocurrency space.

According to data from cryptocurrency analytics platform Lookonchain, AguilaTrades consistently opened long positions before the Bitcoin (BTC) price rose, but never took profits by increasing his position during the rise. This strategy forced him to close the position with a huge loss when the prices fell sharply. On June 8, AguilaTrades created a new wallet and started trading BTC perpetual futures by transferring 39.18 million USDC from the Bybit exchange to Hyperliquid. However, in just two weeks, his account dropped to $4.09 million.

A breakdown of the whale wallet’s transactions went as follows: On June 9, AguilaTrades opened a long position in BTC, his profit increased to $5.76 million but he did not sell. After the decline triggered by the Israel-Iran conflict, he closed his position with a loss of $12.47 million. On June 15, he opened a long position again, his profit reached $10 million, but he did not sell again. This time, he lost $2.95 million as the price fell. On June 20, he took a long position for the third time, making a profit of up to $3.2 million, but once again he did not take a profit. He closed his position with a loss of $17 million as the BTC price fell.

After three failed long positions, AguilaTrades went short, but now has another $2.33 million loss as BTC continues to rally. Lookonchain notes that AguilaTrades opened positions with the right timing each time, but grew the position without taking profit during the rise, and was eventually forced to close positions at a loss when it approached liquidity levels.

The loss of $35 million by AguilaTrades underscores the high-stakes environment of cryptocurrency trading. The trader's missteps serve as a cautionary tale for other market participants, emphasizing the need for thorough analysis and prudent risk management. The cryptocurrency market is known for its volatility, and even experienced traders can fall victim to sudden market shifts and unforeseen events. This incident also raises questions about the reliability of trading strategies and the potential for human error in high-pressure situations.

The fall of AguilaTrades is a stark reminder of the challenges faced by cryptocurrency traders. The market's unpredictable nature requires traders to stay vigilant and adaptable, constantly reevaluating their strategies in response to changing conditions. The loss of $35 million by AguilaTrades serves as a wake-up call for the industry, highlighting the need for improved risk management practices and a greater focus on long-term sustainability. As the cryptocurrency market continues to evolve, traders must remain cautious and disciplined, prioritizing safety and stability over short-term gains.