How an ambitious trading operation turned into a cryptographic thriller: the story of a major trader on Hyperliquid

In December 2025, one of the most active traders on the decentralized exchange Hyperliquid found himself on the brink of disaster, with unrealized losses exceeding $73 million. However, this market participant’s story began quite differently — with a brilliant prediction of a market crash in mid-October.

From Triumph to the Edge of the Abyss

It all started when, on the night of October 11, this mysterious trader (, later dubbed “1011 Insider Whale”), made an unconditional bet against the market. His position amounted to $1.1 billion in short, with $752 million in bitcoin and $353 million in ethereum. At that time, the market was in a strong upward trend, and bitcoin was hovering around $117,000.

Just a few hours later, the trader’s account paid off. On the morning of October 11, the market fell, bitcoin dropped 1% every minute, reaching a low of $102,000. In one day, the crypto market lost over 12% of its value. The mastery of event prediction paid off instantly — the trader closed positions almost at the bottom, doubling his capital from $30 million to $60 million.

The cause of the sharp decline was geopolitical: announcements of a trade war with China and plans to impose 100% tariffs on Chinese goods.

From Success to Failure

However, success did not serve as a litmus test for stability. By October 14, the trader radically changed tactics, switching to aggressive long positions. At the start of this phase, he managed to execute 12 consecutive profitable trades, creating the illusion of a new wave of luck.

By the end of October, positions had accumulated to dangerous levels:

• 191,000 ethereum long contracts at an average entry price of $3,167
• 1,000 bitcoin contracts at an entry price of $91,506
• 250,000 Solana contracts

The total volume of these long positions approached $700 million.

By December 18, the situation worsened. With further declines in the crypto market, (ethereum dropped below the current price of $3,120, and bitcoin traded around $90.91K). The trader’s positions began generating unrealized losses of $73.18 million. Ethereum suffered the most — a loss of $64.28 million.

Liquidation Level: A Fearsome Secret

The most alarming part — the trader’s remaining margin shrank to $27 million. This means that, mathematically, the liquidation price of his ethereum position is around $2,083, representing over 33% decline from current levels. It is approaching an ancient abyss waiting for a mistake.

In mid-December, the trader made a massive on-chain transfer, moving 368,000 ethereum worth about $1.08 billion to five separate wallets. Such operations are usually considered position management or hedging, but they attract significant attention from analysts.

Lessons from Others: How Other Large Traders Avoided the Same Fate

Meanwhile, other whales on Hyperliquid chose more cautious paths. One of them opened long positions worth $555 million in December, but with a moderate leverage of 2.3x — nearly 2-3 times lower than the “insider whale.” This gave them a substantial safety cushion against liquidation.

Another major participant, “pension-usdt.eth,” opted for a more flexible approach — partially liquidating short positions to realize profits, then opening new longs with cautious sizing. Even the trader “Ultimate Short” adhered to a consistent short strategy, collecting small but steady profits.

The Double-Edged Sword of Leverage in Crypto Markets

This trader’s story is a classic parable about crypto dynamics. When the market moves in the right direction, even 5-7x leverage turns small price moves into significant profits. But when the market reverses, the same leverage becomes a guillotine.

On centralized crypto exchanges, leverage up to 100x is available, attracting speculative capital but also creating systemic risks. When one large trader approaches liquidation, forced closure of his positions can trigger a chain reaction, intensifying the decline and liquidating other participants.

What’s Changed in the Market

The current bitcoin price at $90.91K and ethereum at $3,120 indicates prolonged consolidation. In this context, the “insider whale” recognized on October 11 as a market PR stunt remains in position, where each 5-10% move against his expectations could lead to the complete liquidation of his 368,000 ethereum.

His margin buffer of $27 million silently counts every dollar, while his wallets hold ethereum worth over a billion dollars — a kind of future mortgage.