A prominent Bitcoin investor, known for profiting during earlier market turbulence, has opened a new $234 million short position against Bitcoin. Data from the on-chain analytics platform Arkham shows the position was placed through the decentralized exchange Hyperliquid. The move follows Bitcoin’s rebound from its October 10 low of approximately $104,000 to a peak near $114,000 before retreating to around $108,500.
The trader, known as a seasoned market participant, reportedly made a $200 million profit from a short position taken before Bitcoin’s significant drop on October 10. This sell-off occurred soon after former President Donald Trump announced a new 100% tariff on Chinese goods, in addition to the existing 30% tariffs.
The recent bearish stance, with a liquidation price of $123,000, suggests that the investor anticipates further downward movement in the near future.
On October 10, Bitcoin price declined from $122,000 to $104,000 within a few hours. This decrease occurred following President Trump's announcement of tariffs, which heightened market volatility globally.
China's export restrictions on rare earths intensified market turmoil, causing sell-offs of risk assets, including cryptocurrencies. Further strain was added by technical outages at Binance, which disrupted trading of tokens like Ethena's synthetic dollar USDe.
Arkham observed that the whale initiated a substantial short position approximately thirty minutes prior to the announcement of the tariff news. This timing has sparked speculation that the trade may have been made using insider information.
Although no official investigations or allegations have been made, the incident has prompted discussions among traders about the need for greater transparency and regulation in the cryptocurrency market.
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Furthermore, this massive short position has recently come back into the spotlight, as traders and analysts have been paying closer attention to Bitcoin's recent price movement. Despite Bitcoin's recovery from its lows in October, doubts persist about the sustainability of the rebound. Market resistance is strong near the $114,000 level, where momentum has repeatedly been stalling.
The trader's $234 million short holdings represents a conservative position given the continued macroeconomic uncertainty and volatility. While Bitcoin maintains its resilience, major market participants are strategizing for potential downside risks associated with geopolitical developments and policy choices. Traders are keeping a close eye to see if this position will align again with a significant market correction or if Bitcoin will continue its current path above the $100,000 mark.