Ethereum News Today: Ethereum Whales Suffer $60M+ Losses as Derivatives Market Unwinds $196M in Liquidations

The crypto derivatives market remains in a state of flux as major whale movements highlight the growing volatility in Ethereum and Bitcoin positions. Unrealized losses for high-profile accounts have surged this week, with the "BTC OG Insider Whale" account recording over $92 million in losses and holding nearly $655 million in total positions. Meanwhile, the "Ultimate Bear" has continued to profit from Bitcoin short positions, closing over $5.97 million in short exposure this week alone.

Ethereum's decline below the $3,400 level triggered a wave of losses for long positions, particularly among large whale accounts. One notable Ethereum whale on Hyperliquid, labeled "BitcoinOG" on Arkham, now faces a $54 million drawdown after entering leveraged longs during a post-April recovery phase. The whale remains committed to its position, with a liquidation level still comfortably above current prices according to data.

Selling pressure intensified on December 15, when Ethereum liquidations spiked to $196 million. Long positions accounted for the bulk of the forced exits, with traders scrambling to unwind leveraged bets as open interest in derivatives markets fell sharply by over 55%. The collapse in open interest and rise in liquidations suggest traders are avoiding new positions, a clear sign of caution in the market.

Why the Standoff Happened

Ethereum's recent price action reflects a breakdown in bullish momentum after the $3,400 level failed to hold. The cryptocurrency has been drifting lower within a descending channel, dipping as low as $2,800 before stabilizing around $2,926. This pullback has exacerbated unrealized losses for whale holders who had entered long positions during the April recovery.

The "BTC OG Insider Whale" remains one of the largest Ethereum longs on Hyperliquid, holding a $539 million position at an average price of $3,167. The account's unrealized loss of $65.6 million reflects the deteriorating price structure. Despite the losses, the whale has not adjusted its position, indicating a strong conviction in the long-term potential of Ethereum.

In contrast, the "Ultimate Bear" has been systematically closing Bitcoin short positions for profit. This week, the account closed $5.97 million in BTC shorts with a profit of $1.75 million. The bearish position remains sizeable at $50.38 million, with an unrealized profit of $14.56 million (593%) and a liquidation price of $100,800. The bear's actions suggest a belief in continued bearish momentum for Bitcoin.

Derivatives markets have been hit hard by the recent Ethereum sell-off. Derivatives volume surged 53.5% to $87.15 billion, while open interest collapsed by more than 55% to $37.67 billion. The sharp drop in open interest points to a broader unwinding of leveraged positions, as traders exit risky bets in both Bitcoin and Ethereum.

On-chain data also revealed heavy liquidations, with trader accounts repeatedly blowing up. The account known as "Machi Big Brother" suffered yet another forced liquidation on a 25x SETH long, marking its tenth such event in recent weeks. Since the October market crash, the account has seen over 200 liquidations, with cumulative losses exceeding $22.9 million and a current balance of just over $53,000.

Ethereum's technical indicators show little sign of an immediate recovery. The Stochastic RSI has plunged into oversold territory, hovering near 17, which suggests intense selling pressure and weak short-term momentum. If the current trend continues, Ethereum could test the $2,700 support level, where Parabolic SAR support previously appeared.

What Analysts Are Watching

Market observers are closely watching how Ethereum's price action interacts with the $3,000 level. A strong rebound above that threshold could reverse the bearish structure and rekindle bullish momentum. However, as long as the price remains below $3,400, the upside is likely capped, with resistance clustering near $3,436 where Parabolic SAR previously aligned.

Bitcoin's movements are also drawing attention, particularly with the "Ultimate Bear" maintaining a large short position. The bear's liquidation price of $100,800 implies a strong conviction that Bitcoin will not reach that level in the near future. Conversely, any unexpected move toward $90,000 could trigger forced closures of short positions and a temporary rebound in price.

The actions of key whale accounts will likely shape the near-term direction of both Bitcoin and Ethereum. Investors are watching for signs of position adjustments, especially among large ETH longs, which could signal a shift in market sentiment. Until then, the market remains under pressure, with derivatives markets and technical indicators pointing to continued volatility.