During BTC's pullback, why are whales still using 20x leverage to long 84 BTC?

Just now, a whale took a 20x leveraged long position on 84.37 BTC, with an average entry price of $89,566.8. The risk level and market signals of this move are worth noting.

Core Data of the Whale’s Operation

According to the latest information, this transaction occurred at 12:47 today, involving approximately $75.6 million (based on the entry price). This whale address has recently exhibited typical large-holder behavior, with a maximum single deposit of 10 million USDC, and frequently transfers funds in and out.

Price Benchmarking and Unrealized Loss Situation

The comparison between the average entry price and the current BTC price is as follows:

Although the current unrealized loss is small, considering the 20x leverage, the actual loss on this position has reached approximately $2.13 million.

High-Risk Operation in Market Context

BTC has performed weakly over the past week, with a 6.12% decline over 7 days and a 2.93% drop in the last 24 hours. In such a declining environment, the whale’s choice to leverage up and go long reflects two possible intentions:

• Bottom-fishing logic: The large holder might judge that the current price is near a short-term bottom, aiming to amplify gains through high leverage
• Increased risk appetite: The frequent trading activity of this address suggests this could be part of its routine trading strategy rather than a one-time judgment

Risk Assessment of 20x Leverage

What does this leverage multiple imply?

• Liquidation Price: A drop of about 5% in BTC could trigger liquidation risk (assuming a margin rate of 20%)
• Amplified Volatility: A 1% move in BTC results in a 20% change in this position
• Fund Size: 84.37 BTC is a medium-scale operation in the current market, but high leverage makes it a high-risk position

My personal view is that such operations usually occur at two points in time: one is during the final push before the market truly hits a bottom, and the other is short-term trading based on technical signals or other indicators. Given the frequent activity of this address, it is more likely the latter.

Dual Market Signals

The whale’s leveraged long can be seen as a market signal, but should be interpreted cautiously:

• Positive Signal: Large holders increasing their positions during a decline may indicate confidence in the market’s future
• Risk Signal: Excessive leverage can also trigger market volatility; if the trend reverses, forced liquidations could accelerate a downward spiral

Summary

The key point of this operation is not its profit or loss itself, but what it reflects about market sentiment. In the context of BTC’s continuous pullback, large holders still dare to leverage up and go long, indicating there are indeed bottom-fishing voices in the market. However, the high risk associated with 20x leverage also reminds us that such operations are a double-edged sword—if the market moves in the right direction, gains can be substantial; if not, the risk of liquidation is equally significant. For market participants, paying attention to the subsequent developments of such large-holder actions can help understand the true stance of institutional funds.