Hyperliquid Blockchain Sparks New Trend: Traders Conspire to Liquidate Crypto Whales

Will Hyperliquid Blockchain Change the Crypto Landscape for Good? Traders Aim to Liquidate Whales

Hyperliquid Blockchain Sparks New Trend – In an intriguing development on the Hyperliquid blockchain, traders are now actively targeting whales with substantial leveraged positions in a democratized effort to trigger their liquidation levels, according to Markus Thielen, Head of 10x Research. Hyperliquid’s transparency allows market participants to see the positions of large traders, or whales, and understand their liquidation levels, provided no additional margin is added. This transparency is paving the way for coordinated actions by smaller traders looking to liquidate these whales.

Whale Stop-Hunting and Market Manipulation

The concept of stop-loss hunting is well known in the crypto market. Large whales, with their hefty positions, can influence market movement by deliberately triggering stop-loss orders of other traders. Thielen notes that the recent increase in this type of behavior shows a shift in market power, with small traders now joining forces to target whale positions, something that was once mainly the domain of market-making desks and treasury teams at exchanges.

This shift in power is reminiscent of the GameStop short squeeze in 2020, where small traders collectively caused a dramatic price spike by targeting short positions and forcing a squeeze. Traders are now applying similar strategies on Hyperliquid, including a high-profile case involving a 40x leveraged Bitcoin short-seller.

Targeting 40x Leveraged Bitcoin Short Seller

On March 16, a prominent whale placed a 40x leveraged short position on Bitcoin at $84,043, valued at over $368 million. The position faced liquidation if Bitcoin’s price rose above $85,592. A coordinated group of traders quickly mobilized to liquidate the position, leading to a 2.5% price surge in Bitcoin. At one point, Bitcoin’s price reached $84,583.84, nearly triggering the liquidation. Some speculate that the whale may have intentionally exposed the short position for a self-liquidation strategy, aiming to benefit from a rally triggered by their own liquidation.

The rising trend of leveraging blockchain transparency to target whales is drawing attention and raising questions about the future of decentralized trading.

Disclaimer: This article is for informational purposes only and does not constitute investment advice. Cryptocurrencies and stocks, particularly in micro-cap companies, are subject to significant volatility and risk. Please conduct thorough research before making any investment decisions.