Whales exited their positions with a $250 million loss during the crypto crash

Losses exceeding control

A well-known cryptocurrency "whale" — identified through on-chain analysis as the holder of the linked address cluster with the alias “ 0x7a250d …” ( often tracked as a high-volume DeFi trader ) — liquidated almost its entire portfolio during the market crash.

The actual total losses of this " whale " during the multi-day sell-off are estimated at around $250 million, making it one of the largest withdrawals by a single publicly listed entity during this correction.

The majority of the sell-offs occurred on the Uniswap V3, Curve, and 1inch exchanges during the peak of the liquidation period when Bitcoin briefly dropped below $89,000 and Ethereum briefly fell below $2,850 .

Why divest all assets?

The on-chain behavior and contextual signals suggest the following possible reasons:

1/ Reduced leverage/margin call risk — This wallet cluster had significant exposure to leveraged positions (perpetual contracts on Binance/Bybit + DeFi lending protocols like Aave V3 and Compound). A rapid 10-15% drop triggered a chain liquidation.

2/ Panic/Stop-Loss Trigger — Numerous large transfer trades were executed precisely at psychological round levels (90,000 BTC, 2,900 ETH), indicating automatic stop-loss orders or manual panic-driven sell-offs.

3/ No re-entry observed — Unlike typical whale behavior (selling high → buying back lower), this wallet shows no significant re-accumulation since the sharp drop — suggesting either complete surrender or a strategic shift away from cryptocurrency.

Fragile liquidity structure

The cryptocurrency market is stable during calm periods, but liquidity becomes fragmented during periods of stress . The order book thins, spreads widen, and slippage increases—especially for large trades. A large investor (whale) withdrawing funds across multiple exchanges may face unfavorable order execution , exacerbating actual losses.

Such conditions also explain why capitulation events tend to cluster together: large sell orders drive prices down, triggering further liquidations, leading to further sell-offs.

Beyond mechanical factors, psychology is also crucial. Liquidating an entire portfolio indicates surrender—a point where capital preservation takes precedence over hopes of recovery. For large investors (whales), public scrutiny and internal risk management can accelerate this shift, especially after prolonged downturns erode confidence in a short-term recovery.

Lessons learned

Large losses can shape the narrative. They reinforce caution among traders, tighten risk limits, and reduce the appetite for leverage. In the short term, this can curb volatility and slow the recovery. However, over time, reduced leverage will reset the market, creating a healthier foundation for recovery.

For long-term holders, this is just noise. For leveraged traders, it's a harsh but necessary lesson. The cycle continues—and the big players are still accumulating. Markets don't collapse just because one whale sells. They collapse when everyone tries to sell at the same time. That didn't happen here. Those who bought on dips have started to get involved.

Disclaimer: The information presented in this article is the author's personal opinion in the field of cryptocurrency. This is not financial or investment advice. All investment decisions should be based on careful consideration of your personal portfolio and risk tolerance. The views expressed in this article do not represent the official stance of the platform. We recommend that readers conduct their own research and consult with experts before making any investment decisions.

Compiled and analyzed by HCCVenture

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