Hyperliquid

would

Bitcoin

One of this year's more successful crypto short sellers has been wiped out. A wallet known as "pension-usdt.eth" had spent two months betting that <a href="https://thestreet.com/crypto/ethereum" rel="noopener noreferrer nofollow">Ethereum</a>'s (ETH) price would fall.&nbsp;
On Aug. 20&nbsp;morning, that bet collapsed, and the trader's 50,000 ETH short position, worth about $106 million, was forcibly closed at a loss of $23.92 million.
<a href="https://www.thestreet.com/crypto/markets/analyst-makes-bold-1000-bitcoin-price-prediction" rel="noopener noreferrer nofollow">Related: Analyst predicts 1,000% rally for Bitcoin</a>
<h2 id="how-the-position-unraveled">How the position unraveled</h2>
The trade came apart in seconds. According to trading records on&nbsp;<a href="https://www.thestreet.com/crypto/tag/hyperliquid" rel="noopener noreferrer nofollow">Hyperliquid</a>, the <a href="https://www.thestreet.com/crypto/tag/decentralised-exchange" rel="noopener noreferrer nofollow">decentralized crypto exchange</a> where the position was held, the liquidation ran from 04:51:03 to 04:51:15, broken into five forced sales as the exchange scrambled to close the position.&nbsp;
It sold 9,989 ETH at about $2,194, then 20,698 at $2,210, then 15,830 at $2,214, then 1,872 at $2,237. For the final 1,417 ETH, no buyers were left, so Hyperliquid absorbed the remainder into a backstop fund it maintains for exactly these situations.
<h4>Popular on TheStreet Roundtable:</h4>
<ul>
 <li><a href="https://www.thestreet.com/crypto/markets/mysterious-trader-buys-millions-ahead-of-trumps-2-30-pm-meeting" rel="noopener noreferrer nofollow">Mysterious trader buys millions ahead of Trump's 2:30 PM meeting</a></li>
 <li><a href="https://www.thestreet.com/crypto/markets/billionaire-who-once-sued-zuckerberg-has-major-bitcoin-prediction" rel="noopener noreferrer nofollow">Billionaire who once sued Zuckerberg has major Bitcoin prediction</a></li>
 <li><a href="https://www.thestreet.com/crypto/markets/cathie-wood-sends-a-three-word-message-on-crypto-investing" rel="noopener noreferrer nofollow">Cathie Wood sends a three-word message on crypto investing</a></li>
</ul>
Here's the trap: over those 12 seconds, ether's price climbed about $43. Because closing a short means buying the asset back, the trader's own forced purchases helped push the price up, making each remaining chunk more expensive to close, a costly feedback loop.
<figure><a href="https://x.com/lookonchain/status/2090233185410097648" rel="noopener noreferrer nofollow"></a>
 <figcaption>
 Source: <a href="https://x.com/lookonchain/status/2090233185410097648" rel="noopener noreferrer nofollow">Lookonchain</a>
 </figcaption>
</figure>
<h2 id="a-painful-reversal-of-fortune">A painful reversal of fortune</h2>
The loss stings more given the wallet's track record. It had booked around $49 million in profits this year betting against <a href="https://www.thestreet.com/crypto/tag/cryptocurrencies" rel="noopener noreferrer nofollow">crypto</a>, including nearly $6 million on a 60,000 <a href="https://www.thestreet.com/crypto/tag/eth" rel="noopener noreferrer nofollow">ETH</a> short and $3.6 million on a 1,400 BTC short, both closed in June.&nbsp;
This single liquidation erased roughly half of everything it had earned. Hyperliquid's leaderboard now shows the account holding just $35.61, down 100% over the past 30 days.
The wipeout came as crypto surged broadly. A <a href="https://www.thestreet.com/crypto/policy/treasury-secretary-bessent-takes-major-step-to-cement-u-s-dollars-global-dominance" rel="noopener noreferrer nofollow">Treasury</a> buyback <a href="https://home.treasury.gov/news/press-releases/sb0607" rel="noopener noreferrer nofollow">announcement</a> helped send ether up about 18% in 24 hours and pushed Bitcoin from around $64,000 toward $70,000.
The wallet was far from alone: it was part of roughly $2.74 billion in short positions liquidated across the market in a single day.
<a href="https://www.thestreet.com/crypto/markets/short-squeeze-sends-bitcoin-to-72000-and-erases-1-6-billion" rel="noopener noreferrer nofollow">Related: Short squeeze sends Bitcoin to $72,000 and erases $1.6 billion</a>

Trader loses $24 million in a brutal 12-second span

Table of Contents

TheStreet Roundtable

Other articles published on Aug 20, 2026

Join our free newsletter for daily crypto updates!