A major Bitcoin investor, often referred to as a whale, has closed a substantial short position worth over half a billion dollars, capitalizing on Bitcoin’s price movements ahead of the Federal Open Market Committee (FOMC) meeting this week. The move resulted in a profit of nearly $10 million within just eight days.
Whale’s Strategic Short Trade
The crypto whale placed a leveraged bet against Bitcoin, opening a 40x short position on 6,210 BTC—valued at approximately $516 million. Leveraged trading allows investors to borrow funds to increase their trade size, amplifying both potential profits and risks.
Bitcoin whale made $9.4 million in profit. Source: Hypurrscan
According to data from Hypurrscan, the whale initially entered the position at $84,043 per Bitcoin. However, as market conditions shifted, the investor was forced to add $5 million to avoid liquidation, which would have occurred had Bitcoin’s price surpassed $85,592. Despite the pressure, the whale managed to close all short positions within a few hours, securing a $9.46 million profit.
Traders Attempt to Force Liquidation
The successful trade came despite efforts from a publicly coordinated group of traders who attempted to “hunt” the whale’s liquidation point. This strategy, often seen in highly leveraged markets, involves deliberately pushing the asset’s price towards a known liquidation threshold to force losses on large positions. However, the attempt ultimately failed, allowing the whale to walk away with significant gains, blockchain analytics firm Lookonchain reported on March 17.
Profits Shifted to Ethereum
Following the closure of the short position, the whale immediately reinvested a portion of the profits into Ethereum (ETH). On March 18 at 7:31 am UTC, Etherscan data confirmed that the investor acquired over 3,200 ETH, valued at more than $6.1 million. This suggests confidence in Ethereum’s potential ahead of upcoming market events.
FOMC Meeting and Inflation Impact
The whale’s profit-taking move comes just ahead of the FOMC meeting on March 19, a key event expected to provide further clarity on the Federal Reserve’s monetary policy for 2025. Market participants are closely monitoring the meeting’s outcome, as any shift in interest rate expectations could impact investor sentiment toward risk assets like Bitcoin.
Recent data from the US Consumer Price Index (CPI) indicated a year-on-year inflation increase of 2.8% in February, slightly lower than the forecasted 2.9%. Analysts believe this decline could be a positive indicator for Bitcoin’s future price movement.
Market Analysts Weigh In
Fumihiro Arasawa, co-founder and CEO of xWIN Research, suggested that easing inflation concerns might influence the Federal Reserve’s decision-making process.
“This suggests that inflationary pressures are gradually easing, which could influence the Federal Reserve’s monetary policy decisions,” said Arasawa.
He further noted that Bitcoin’s short-term performance will depend on its ability to hold the critical $81,000 support level. “A sustained hold could stabilise sentiment, while a breakdown may trigger further corrections,” he added.
Bitcoin target rate probabilities. Source: CME Group’s FedWatch tool
Meanwhile, Ryan Lee, chief analyst at Bitget Research, pointed out that market expectations remain largely in favour of unchanged interest rates.
“The market largely expects the Fed to hold rates steady, but any unexpected hawkish signals could put pressure on Bitcoin and other risk assets,” said Lee.
Market Sentiment Ahead of FOMC Decision
Current estimates from the CME Group’s FedWatch tool suggest a 99% probability that the Federal Reserve will maintain its current interest rate levels. However, investors remain cautious, as any deviation from expectations could significantly impact Bitcoin and other cryptocurrencies.
As the market awaits the FOMC’s decision, Bitcoin’s trajectory remains uncertain. The whale’s recent strategic trades highlight the volatility of the crypto space and the opportunities that exist for those who can accurately anticipate market movements.
