Ethereum News Today: Leverage's Peril: Crypto Whale's $26M Loss Mirrors Market's Downward Spiral

A major crypto whale has reportedly realized a $26.348 million loss over four months by partially liquidating leveraged positions in WBTC and ETH, according to on-chain analysts. The move underscores growing volatility in the crypto market as leveraged longs face mounting pressure amid declining asset prices.

The whale's strategy involved a $250 million portfolio, with 1,610.93 BTC (15x leverage) and 19,894.21 ETH (3x leverage) positions, initially opened at $108,043.9 per BTC and $4,037.43 per ETH. However, recent deleveraging actions—such as returning 150 WBTC to Binance—suggest a shift in risk management, with unrealized losses potentially reaching $3.734 million if liquidated. The position, which holds 550.2 WBTC in Aave with $28.09 million in stablecoin debt, faces a liquidation threshold at $65,436 per WBTC, highlighting the precariousness of leveraged setups.

Separately, a HyperLiquid platform user suffered a $4.07 million loss from a 6x leveraged ETH long position, with an additional $6 million in unrealized losses, indicating broader challenges for leveraged traders. These events align with wider market trends: the U.S. spot Ethereum ETF saw a $260.66 million net outflow, while ETH and BTC prices fell below $2,800 and $87,000, respectively.

The whale's actions reflect a broader trend of deleveraging in the crypto market. In May-July 2025, the entity withdrew 700.19 WBTC (worth $81.63 million) from Binance, averaging $116,593 per WBTC. Recent deposits of 150 WBTC back to Binance signal a strategic reduction in exposure, though the position's health factor of 1.4 suggests continued vulnerability to price swings.

Market analysts attribute the losses to sustained downward pressure on crypto assets. The U.S. spot Bitcoin ETF also experienced a $904 million net outflow, compounding concerns about investor sentiment. Meanwhile, macroeconomic factors—including a higher-than-expected September unemployment rate of 4.4% have contributed to a risk-off environment.

The whale's experience highlights the risks of leveraged positions in a bearish market. While the BTC and ETH positions initially reduced floating losses to $3.12 million, the recent deleveraging and partial liquidations indicate a reversal of fortune as prices remain below key levels. On-chain analysts warn that further declines in WBTC or ETH could trigger cascading liquidations, particularly for positions with low health factors.