In just two months, a mysterious whale used $1.1 billion in short positions to precisely harvest the market, then reversed to place $700 million in long positions on the brink of liquidation, staging the most thrilling fate reversal in the crypto world.
This trader, code-named '1011 Insider Whale', accurately established a short position worth $1.1 billion before the market crash, including $752 million in Bitcoin shorts and $353 million in Ethereum shorts. He closed near the market's lowest point, doubling his $30 million principal to $60 million before quickly exiting.
I. Epic Short Selling
On the evening of October 10, 2025, the crypto market was still immersed in a bullish atmosphere, with Bitcoin prices staying high at $117,000. At this time, a meticulously planned short-selling operation had quietly begun.
● The trader later known as the "1011 insider whale" began depositing funds into the decentralized exchange Hyperliquid to establish short positions in Bitcoin and Ethereum. By the evening of the 10th, the total value of his short positions had reached $1.1 billion.
● Around 5 a.m. the next day, the market suddenly collapsed. Bitcoin fell nearly 1% per minute within 30 minutes, hitting a low of $102,000, with a daily decline of over 12%. The short position of this whale quickly became profitable, eventually closing near the market's lowest point.
● Post-analysis indicates that the direct trigger for this crash was former U.S. President Trump's announcement to restart the trade war with China, planning to impose a 100% tariff on Chinese goods starting November 1.
2. Strategy Reversal
● Surprisingly, this whale began to completely change his trading strategy in mid-October. Starting from October 14, he began to establish long positions in Ethereum and Bitcoin, achieving an impressive record of 12 consecutive profitable trades thereafter.
● By October 24, this whale had held long positions in Ethereum worth $132 million and Bitcoin worth $20 million, accumulating a profit of $12.634 million. The leverage he used was relatively cautious, with a leverage of 5 times for Ethereum positions and 4 times for Bitcoin positions.
● Market data shows that multiple top traders simultaneously shifted to a long strategy at that time, with total positions exceeding $200 million. The leverage used by whales also became more rational, with long positions generally concentrated in the range of 4-7 times compared to the previous high leverage of 20-40 times.
3. The Edge of the Abyss
The plight of this whale began with his misjudgment of the market direction. From late October to December, he continued to increase long positions, and by December 18, the total position size had reached approximately $700 million.
● Specific holdings include: 191,000 Ethereum long positions, opening price $3,167; 1,000 Bitcoin long positions, opening price $91,506; and 250,000 Solana long positions.
● With the continued decline of the cryptocurrency market, these positions have resulted in massive unrealized losses. As of December 18, this whale's total unrealized losses had reached $73.18 million, with $64.28 million in unrealized losses on Ethereum long positions alone.
● More critically, his margin was only $27 million, while the liquidation price of his Ethereum long positions was around $2,083. This means that if the market continues to decline, he will face the risk of liquidation.
4. Comparison of Whale Actions
This "insider whale" is not the only active large trader in the market. On December 12, another Hyperliquid whale took a completely different strategy.
● This trader established a long position worth $555 million at a low leverage of about 2.3 times, covering Ethereum, Bitcoin, and Solana. This leverage level is significantly lower than that of the "insider whale," indicating a more conservative risk management strategy.
● Another whale marked as "pension-usdt.eth" closed a short position in Bitcoin worth approximately $88.8 million on December 15, making a profit of about $950,000, and then established a long position in Bitcoin worth $32.11 million.
● Meanwhile, the trader known as the "ultimate short" continued to maintain a short strategy, closing part of his Bitcoin short position again on December 18, making a profit of about $1.75 million. His Bitcoin short position was about $50.38 million, with an unrealized profit of $14.56 million.
5. Market Chain Reaction
● The movements of large positions by whales often have a significant impact on market sentiment. On December 17, the "1011 insider whale" made another striking on-chain operation, transferring approximately $1.08 billion worth of 368,000 Ethereum to five newly created wallets.
● Such large-scale asset transfers are typically interpreted as position management or preparation for potential operations, rather than direct sales. Nevertheless, such a large scale of capital flow still attracted widespread market attention. If this whale's long position is ultimately forcibly closed, it could trigger a chain reaction in the market. Large-scale liquidations could exacerbate the market decline, creating a vicious cycle.
6. The Double-Edged Sword of Leverage
● This case of the "insider whale" highlights the enormous risks of leveraged trading in the cryptocurrency market. His successful short position on October 11 can be partly attributed to the relatively high leverage he employed.
When the market direction is correctly judged, leverage can significantly amplify profits; however, when the market trend goes against expectations, leverage can also accelerate losses.
● Compared to traditional financial markets, cryptocurrency exchanges generally offer higher leverage multiples, with some platforms even offering leverage as high as 100 times. This high-leverage environment, while attracting a large amount of speculative capital, also increases the overall fragility of the market.
● The core of this whale's current predicament lies in the high leverage of its Ethereum long positions. According to estimates, the liquidation price of its Ethereum long positions is around $2,083, which is still a considerable distance from the current market price, but if the market continues to decline, the risk will significantly increase.
As of December 18 data, this whale, who once accurately predicted the market crash, still has an average opening price of $3,167 for his Ethereum long positions, while the liquidation line at $2,083 looms like a gradually approaching cliff.
His 368,000 Ethereum worth $108 million quietly lay in five new wallets, while the remaining margin of $27 million in the trading account silently calculated every dollar distance to the liquidation point.
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