Bitcoin whale wagers hundreds of millions on BTC's short-term decline

A Bitcoin whale is wagering hundreds of millions on Bitcoin's short-term decline, ahead of a week filled with key economic reports that may significantly impact Bitcoin's price trajectory and risk appetite among investors.

A Bitcoin whale is wagering 40x leveraged short on over 4,442 Bitcoin (BTC) — valued at over $368 million — ahead of a week filled with key economic reports that may significantly impact Bitcoin's price trajectory and risk appetite among investors.

According to Hypurrscan data, the large crypto investor placed the short position at an average entry price of $84,043 and faces liquidation if Bitcoin's price surpasses $85,592.

The investor has generated over $2 million in unrealized profit, however, he has an over $200,000 loss on his position's funding fees.

Leveraged positions are used to increase the size of an investment with borrowed money, which can boost the size of both gains and losses, making leveraged trades riskier compared to regular investment positions.

The investor's significant leveraged bet comes ahead of a week of numerous significant macroeconomic and crypto-related events.

This includes the upcoming Federal Open Market Committee (FOMC) meeting on Monday, March 19, which may impact investor appetite for risk assets such as Bitcoin.

The macroeconomic outlook will be closely monitored following reports of a large crypto whale shifting a staggering 49,900 Bitcoin (BTC), currently valued at approximately $650 million, from Coinbase to an unknown wallet.

Earlier in March, a savvy trader made a significant $68 million profit from a 50x leveraged short position on Ether (ETH). The trader, who prefers to remain anonymous, capitalized on ETH's 11% price decline.

See also: Crypto trader makes $68M profit from 50x leveraged short on ETH — Report

The leveraged trades highlight the potential for both significant gains and losses in the crypto market, especially with the use of leverage, which can amplify both the size of gains and losses.

As crypto prices are known for their volatility, traders who employ leveraged positions must be prepared for rapid shifts in market trends, which can affect the outcome of their leveraged trades in surprising ways.