Whale Closes 50x ETH Long on Hyperliquid Amid Market Crash

Tags: ethereum, hyperliquid, on-chain, whale

Key Takeaways:

• A prominent whale on Hyperliquid just closed out a colossal 50x leveraged ETH long as the market crashed to new lows.
• Ethereum’s plunging price caused a cascade of liquidations, applying pressure on Hyperliquid and raising fears about market stability.
• The whale’s rapid changes in position mirror a fast-moving environment, in which leveraged bets can turn sentiment in seconds.

Hyperliquid Whale Close 50x ETH Long Amidst Market Plummet

Ethereum’s latest collapse has shaken the crypto world, with Hyperliquid standing out as one of the most visible places where the effects were felt. ETH hit a low of $1,411 on April 7, its lowest price since March 2023, triggering a wave of liquidations and rapid shifts in market positioning.

One of the more notable moves: a whale who has a penchant for high-risk trading on Hyperliquid closed an enormous 50x leveraged long on ETH. This same address had benefitted from a 50x short in the past and had just switched to a bullish stance by opening a 20x long near $1,459. However, as ETH crashed and dove toward the whale’s liquidation threshold of $1,391, the position was force-closed or cashed out to prevent full wipeout.

According to on-chain data from Hyperrscan, the whale deposited 3 million USDC to open a 20x leveraged long position on 32,800 ETH at $1,461.6 — a $47.62 million bet. With ETH in freefall, the high leverage meant even small moves carried huge risk, and it seems the position was either force-closed or exited by the whale, likely to avoid a full liquidation.

This is not the whale’s first rodeo. They made a $1.87 million profit shorting ETH with 50x leverage (also Hyperliquid) earlier this year. The rate at which that flip went from short, to long, to now closed underscores how fast sentiment changes in leveraged DeFi trading — especially when betrayed by whales.

Crypto Whale Exits Bitcoin Shorts, Pockets $1.4M Profit – Then Re-Opens Position

Liquidations Have Spread Across Hyperliquid and Other Platforms for ETH

The whale’s dramatic exit is just one story in a larger wave of liquidations sweeping the Ethereum market. More than 440,000 ETH, worth about $640 million at current market prices, are on the verge of liquidation between the $1,000 and $800 price range, according to DefiLlama data. Many of them are highly leveraged positions concentrated at the top addresses in the market, leaving it susceptible to cascading liquidations.

Hyperliquid is at the center of this drama. As one of the fastest growing DEX for perpetual futures, it also has ultra-high leverage options with minimal collateral required. While this draws the interest of aggressive traders, it also exacerbates market fragility.

Hyperliquid faced scrutiny earlier this year when whale-driven moves like this helped crash the price of the JELLY token. At the time, massive liquidations raised questions about whether the platform’s architecture could withstand extreme volatility. For now, Hyperliquid seems to be absorbing the blow — in part due to its vault mechanism, which diffuses the losses among vault participants (similar to liquidity providers) when large positions are liquidated.

Analysts are still somewhat cautious, however. If ETH does continue its descent or if more whales choose that route, that could create increasing pressure on platforms like Hyperliquid, particularly in light of renewals of fears over the market structure and leverage being the primary driver of the mood against the backdrop of the loss of short-term sentiment.

Staking Constraints and ETF Outflows Fuel Hyperliquid Turbulence

While the recent events focus on Hyperliquid, broader structural forces are also affecting Ethereum’s price action. In this way, both Ethereum staking and ETF products may be ramping up the sell pressure on downturns.

To take a specific example, staked ETH is not immediately redeemable. Only 16 validators are allowed to exit at a time, per epoch (6.4 minutes), meaning it would take 55 days for large ETF-related ETH holdings to fully withdraw (if panic were to ensue) Such illiquidity can deter defensive exits during market crashes, locking capital in a depreciating asset.

ETH spot outflows reached a new yearly record — U.S based Ethereum spot ETFs experienced fourth consecutive weeks of net outflows, totaling $400 million in March alone. Unlike Bitcoin ETFs, most ETH fund proposals won’t pass on staking yields to investors. While institutions rake in fees without delivering a corresponding staking advantage to investors, these products are less enticing in times of market uncertainty.

These dynamics create an environment where market participants have had fewer tools and options to hedge or exit positions effectively — particularly with the speed at which prices fall. For whales on DeFi platforms such as Hyperliquid, it means the timing of every entry or exit move needs to be spot on or risk cataclysmic losses. Consequently, even run-of-the-mill leverage plays have turned into high-stakes gambles, with wider ramifications for Ethereum’s market stability.