On-Chain Evening Recap: Whales Continue to Accumulate, Short-Term Volatility May Further Expand

A major insider whale in the cryptocurrency market has experienced a dramatic shift in unrealized gains and losses over the past month. The whale, known for its leveraged positions in Bitcoin (BTC), Ethereum (ETH), and Solana (SOL), saw its unrealized profit-and-loss (PnL) drop from +19 million to -77 million before recovering to +11 million within the same period. This swing reflects the intense volatility seen in crypto markets during late 2025.

Bitcoin dropped below $87,000 at the height of this volatility, causing widespread unrealized losses for leveraged traders. The whale managed to avoid liquidation by maintaining strong equity and selective positioning. As Bitcoin rebounded above $98,000, the whale's unrealized PnL began to recover, showing a 7.3% return on equity despite the massive position size according to reports.

The whale's experience highlights the risks and rewards of leveraged trading in a volatile market. The trader's strategy, based on long-term belief, allowed it to withstand the downturn without exiting the market. This approach contrasts with many retail traders who often sell during steep declines.

Why Did This Happen?

The whale's leveraged positions amplified both gains and losses as minor price fluctuations led to multi-million-dollar moves in unrealized PnL according to market analysis. The trader held positions totaling up to $745 million notional value, with leverage between 3x and 10x. This exposure made the whale particularly vulnerable to market swings during periods of high volatility.

The broader market conditions contributed to the volatility. Macro uncertainties, including Federal Reserve policy signals, changing rate expectations, and geopolitical events, played a role in the crypto market's price fluctuations. These factors put pressure on high-leveraged traders, making the whale's strategy all the more notable.

How Did Markets React?

Ethereum (ETH) saw a surge in open interest on Binance, rising above $7.1 billion, indicating aggressive long positions among traders as the year began. This increase coincided with ETH breaking through a key resistance level at $3,100, suggesting a bullish shift in market sentiment. The open interest surge suggests traders are opening new positions rather than merely covering short positions according to trading data.

The ETH Cumulative Volume Delta also showed a significant rise, indicating a strong buyer dominance in the market. Traders opted for market orders over passive limit bids, demonstrating urgency and confidence in Ethereum's upward trajectory. This behavior reflects a high conviction in the market's potential, with traders willing to enter the market immediately rather than wait for lower prices.

What Are Analysts Watching Next?

The whale's recovery supports the narrative of "diamond hands" in crypto, where strong conviction and risk management can outperform reactive trading according to analysis. However, the episode also highlights the risks of leveraged trading, particularly in a volatile market. Analysts are watching to see if the whale's strategy can be replicated by others, or if it was a one-off success based on unique circumstances.

Market analysts are also monitoring the broader macroeconomic signals, particularly Federal Reserve policy. Philadelphia Fed President Anna Paulson suggested that rate cuts may occur later in 2026 if inflation cools, but cautioned that they may not be imminent. The U.S. jobs data for December and ISM activity reports are key focus points for investors trying to gauge the timing of the next rate cut according to market forecasts.

Webull Corp (BULL) is also under scrutiny as the company prepares to report earnings in February 2026. The company has shown strong growth in recent quarters, with Q3 2025 earnings exceeding forecasts by 133.33% and revenue up 55% year-over-year. Investors will be looking to see if this momentum continues in the next earnings report, scheduled for February 25, 2026.

Churchill Resources is also preparing for its 2026 exploration season, with significant discoveries made at the Black Raven Project in Newfoundland. The company has identified a high-tenor antimony and gold-silver system, which could expand the project's footprint and attract further investment. With strong treasury reserves and no immediate capital needs, Churchill is well-positioned to advance its exploration program according to company reports.