Will the record BTC short position with 40x leverage survive a market rally?

A major player in the crypto market has made a decisive move — opening a massive short position on Bitcoin with 40x leverage worth $34.3 million. Currently, this position is showing disappointing results with an unrealized loss of about $230,000. This information is reported by BlockBeats, based on data from Coinbob Monitor and activity analysis of large addresses.

Position Breakdown: Details of the $34.3 Million Short Contracts

According to monitoring data, the address labeled “Strategy Counterparties” began its operation early on February 28, when BTC was valued at $65,270. Using 40x leverage, the trader created short contracts totaling $34.3 million with an average entry price of $65,300. The critical liquidation price for this position is set at $84,200, meaning even a slight increase in the price poses a serious risk for the trader. The current unrealized loss is approximately $230,000, or -27% of the position’s value.

On the market, it holds the most prominent position — the largest short position on BTC and DASH within the blockchain at this time. The address showed activity at 6:00 AM that same day, adding to its short position, thereby increasing its bet on a price decline.

Trader’s History: From Successes to Current Difficulties

This address is well known in the crypto community for its bold tactical moves. When giant MicroStrategy launched a massive Bitcoin buying campaign in December (MSTR), this major player was not indifferent — it immediately opened a large short position on major cryptocurrencies, betting in the opposite direction.

Analysis of previous trades indicates a consistent trading strategy: the address systematically buys on rises and sells on dips, profiting from market fluctuations. This approach has historically yielded results, especially on altcoins. The DASH position, which was recently cut by more than half, still shows an unrealized profit of $4.1 million with an clearly aggressive average entry price of $71.3 per token.

Waves of Volatility and the Risk of Collapse

The current situation with the 40x leverage position exemplifies the risks of extreme leverage. Even minor fluctuations in BTC’s price upward could trigger cascade liquidations. If the market continues to rise, the trajectory toward liquidation at $84,200 becomes increasingly likely, threatening to wipe out a significant portion of capital.

This case illustrates the eternal conflict in the market: an ambitious 40x leverage tactic can generate huge profits but also entails catastrophic risk if it fails. Major players in the crypto market continue to play this high-risk game, and the blockchain is closely watching how events unfold.