Synopsis: A high-stakes crypto gambler lost $168M shorting the market’s bottom on HyperLiquid, then recklessly reopened $115M shorts highlighting leverage risks and volatile trader psychology.
A high-stakes crypto trader faced a massive $168 million liquidation after betting against the crypto market’s bottom. This dramatic wipeout happened on the decentralized futures platform HyperLiquid during a volatile weekend.
Surprisingly, the trader didn’t back off but quickly doubled down with fresh $115 million short positions on GMX. Such reckless moves echo past crypto blowups and remind us how risky crypto leverage trading remains.
Big Bet on a Falling Market
The trader, known for risky bets and crypto gambling deposits on platforms like Stake and Roobet, targeted bitcoin (BTC), XRP, zcash (ZEC), and smaller tokens in a $168 million leveraged short around Friday. This bet came as several tokens hit multi-month lows, and crypto’s fear and greed index showed “extreme fear.”
When the market unexpectedly bounced back on Sunday, the trader’s shorts were wiped out, forcing $5.5 million in losses due to liquidation costs and slippage. This shows how timing bets in crypto, even with huge leverage, can quickly backfire.
Doubling Down After a Smash
Instead of stepping back, the trader immediately opened new shorts worth $115 million in BTC and ether (ETH) on GMX, a decentralized exchange known for low fees and high leverage.
These new positions remain active and recently showed $1.4 million in unrealized gains amid market pulls. This “all-in” approach reflects the impulsive nature of some crypto traders who chase adrenaline-fueled bets without pause. Such behavior often leads to volatile swings and costly mistakes.
Lessons from Previous Crypto Failures
This episode strongly resembles James Wynn’s dramatic $100 million loss earlier in 2025, when he went long on BTC at its peak using extreme leverage on HyperLiquid. Wynn, a pseudonymous trader, lost nearly everything after a price correction wiped out his positions.
Both cases reveal the dangers of reckless timing and high leverage in crypto futures trading. Experts warn that liquidations by such whales can spike market volatility, affecting all traders. While DeFi platforms offer exciting opportunities, they also magnify risks when traders overreach.
Warning for Crypto Traders
This high-profile liquidation highlights the dangers beneath crypto’s thrilling price surges. It shows how high leverage acts as a double-edged sword it can amplify gains but can also erase fortunes fast.
Retail traders should heed this cautionary tale about risk management, especially during uncertain markets showing signs of “extreme fear.” Watching this trader’s open GMX positions will be instructive: if prices keep falling, profits could grow; if markets hold, losses mount. Crypto remains a wild ride, fueled by gamblers willing to bet big and face brutal consequences.
Ultimately, the saga shows the ongoing volatility and maturity challenges in crypto trading, where innovation meets gambler mentality head-on. For many, it’s a reminder to trade wisely or risk losing big.
Written By Fazal Ul Vahab C H