"Just $41 Up, It's Over"...Ethereum Faces $100 Million 'Short Liquidation' Crisis

▲ Ethereum (ETH)/AI generated image

A $100 million Ethereum (ETH) short position opened on Hyperliquid, drawing significant market attention. This position is a high-risk trade with 23x leverage, structured such that it could be automatically liquidated if the Ethereum price rises by just $41 above its entry price.

According to Bitcoin.com on May 25 (local time), on-chain wallet 0x50b3 opened a short position of 47,604 ETH on Hyperliquid. The notional exposure is $100.03 million, with an estimated entry price of approximately $2,109.

The liquidation price for this position is set at $2,149.84. Even if Ethereum rises by just $41 from the entry price, a forced liquidation could occur, with the price increase being less than 2%. In a 23x leverage structure, the margin cushion is approximately 4.3% of the position size, based on standard exchange mechanisms.

Bitcoin.com evaluated this trade as a high-risk bet reflecting strong conviction that it could prevent further Ethereum price increases. Given that the position size exceeds $100 million and the liquidation price is very close to the entry price, even small price movements could lead to significant market impact.

Hyperliquid has recently seen a recurring appearance of large-scale leveraged trades. Previously, a trader realized a $7.5 million profit from Zcash (ZEC) and Hyperliquid (HYPE) long positions, then opened a new $38.6 million Ethereum 25x long position.

The concentration of large positions coincides with the expansion of Hyperliquid's trading activity. Bitcoin.com reported that Hyperliquid processed over $176 billion in 30-day trading volume, and its open interest surpassed $8 billion as of late May.

Hyperliquid's revenue over the past 12 months exceeded $896 million. Bitcoin.com explained that institutional investors are increasingly utilizing Hyperliquid for positions of this magnitude due to its on-chain settlement structure, which reduces counterparty risk.

This short position will be automatically liquidated if wallet 0x50b3 does not add more margin or reduce the position before Ethereum surpasses $2,149.84. If liquidation occurs, 47,604 ETH would be released back into the market as a single event. The identity of this wallet has not been confirmed.

*Disclaimer: This article is for investment reference only, and we are not responsible for any investment losses based on it. The content should be interpreted for informational purposes only.*