Whale Lightning Reversal: Closed ETH position for 1.31 million profit, but turned around and increased BTC holdings, now at a floating loss

“Lightning Reversal” whale’s strategy took a major turn today. According to the latest news, this well-known on-chain address first closed an ETH short position with a profit of $1.312 million, then immediately shifted to a long position on BTC, currently holding 754.92 BTC with 20x leverage (approximately $67.27 million), but since opening the position, it has already incurred an unrealized loss of $565,000. This rapid strategy switch reflects a change in large capital’s market outlook and also exposes the risks of high leverage operations.

From Hedging to Unilateral: The Whale’s Strategy Shift

Closing to realize profits, releasing hedge positions

According to the latest news, the “Lightning Reversal” whale closed an ETH short position on January 21, realizing a profit of $1.312 million. This closure is crucial because it breaks the whale’s previous hedging strategy. On January 20, this address was simultaneously long BTC and short ETH, using hedging to control risk. But today’s closure indicates a decline in confidence in ETH’s future price movement, prompting it to lock in gains.

Switching to a unilateral long BTC

After closing the ETH short, the “Lightning Reversal” did not stop but instead increased its BTC long position. The current holding is 754.92 BTC, with 20x leverage, equivalent to an investment of about $67.27 million. The average entry price was $89,848.3, while the current BTC price is $89,081.17, already in a loss.

Data Comparison: Recent Operation Trajectory

Risks Behind High Leverage

This whale’s trading style has always been aggressive. 20x leverage means that a roughly 5% drop in BTC price could trigger liquidation risk. More notably, its BTC long position on January 19 was already over 50% unrealized loss, and it continued to average down. Although the new BTC position only shows an unrealized loss of $565,000, under high leverage, this number can quickly escalate.

According to the latest data, BTC has fallen 3.58% in the past 24 hours and 6.60% over the past 7 days. In such a downward environment, increasing long positions requires strong risk tolerance or firm confidence in a rebound.

The Dual Nature of Market Signals

On the surface, the “Lightning Reversal” shifting from hedging to a unilateral long BTC might be interpreted as a sign that large funds are optimistic about BTC’s future. However, looking at its historical operations, this address’s judgment has not always been accurate. It was already deeply in loss when it flattened its BTC long on January 19, and now it is adding to the position, which seems more driven by a “recovery pursuit” mentality rather than a calm fundamental analysis.

Summary

The strategy shift of the “Lightning Reversal” whale demonstrates active and aggressive large on-chain capital. The $1.312 million profit from closing ETH shorts is noteworthy, but the immediate unrealized loss after increasing BTC positions highlights the risks of high leverage. The whale’s strategy changes can serve as a reference for market sentiment but should not be a reason for blind follow-up. For ordinary investors, it is more important to understand the logic behind these large capital operations rather than blindly copying their positions.