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A cryptocurrency whale took a high-stakes bet on Bitcoin and Ethereum just before President Donald ... [+] Trump announced the creation of a strategic crypto reserve.
The Leveraged Crypto Bet Ahead of Trump’s Strategic Crypto Reserve Bombshell
A cryptocurrency whale took a high-stakes bet on Bitcoin and Ethereum just before President Donald Trump announced the creation of a strategic crypto reserve. It paid off spectacularly. Mere hours before Trump made the announcement, an anonymous trader opened a 50x leveraged long position on BTC and ETH with $4 million on margin. As crypto prices surged on Trump’s news, the trader closed the position, netting over $6.8 million in profit. The timing was fortunate, and the bet was structured with little downside protection, making some wonder if it may not have been fortuitous and if the trader had advanced knowledge of Trump’s announcement.
Market Context Before Strategic Crypto Reserve News
Bitcoin and Ethereum were already edging upward when Trump’s crypto reserve news hit, and then they spiked dramatically. Bitcoin’s price surged past $90,000 and hit a high of over $95,000 on March 2, roughly up 10 percent on the day. Ethereum jumped over 13% breaking $2,500. This was a sharp reversal from the prior weeks when Bitcoin entered a technical bear market, dropping over 20% from a high in January and it kicked off a wave of renewed bullish enthusiasm across the crypto market.
A Lucky Bet On Trump's Strategic Crypto Reserve Announcement?
Prior to Trump’s strategic crypto reserve announcement, the trader deposited close to $6 million to Hyperliquid, a decentralized exchange, and used the funds to create large 50x leverage long positions on BTC and ETH. The use of leverage brought his total position to a total value of over $200 million, drawing the attention of blockchain analysts.
In the early morning on Sunday, the price of ETH “had fallen so that the trader’s long position was in danger of liquidation — around 9:37 am, if ETH had fallen just $54 dollars more, the trader’s long position would have been liquidated, resulting in a loss of over $2 million, according to The Block. Trump’s crypto strategic reserve announcement came at 10:24am ET sent crypto prices soaring. The trader closed the long positions shortly after Trump’s announcement and netted $6.8 million in profit. Interestingly, the trader could have profited much more if they had held positions slightly longer. Trump’s initial crypto reserve post didn’t mention BTC and ETH, but in a follow-up post, he clarified that they would be included in the reserve, which led the prices of those tokens to jump even higher.
The bet’s uncanny precision has prompted insider information concerns. The trader’s entry was timed almost precisely to precede Trump’s reveal on his Truth Social account, aligning perfectly with the announcement’s timing. Moreover, the betting structure drew skepticism given the razor-thin leeway the trader had if BTC and ETH prices declined. To reiterate and put the risk in perspective, the long positions were so highly leveraged that a price dip of merely ~2 percent in BTC or ETH would have liquidated the trader’s entire $4M stake. Yet, instead of faltering, prices rose precisely when needed. Such a windfall right before market-moving news inevitably raises the specter of insider trading.
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