$11B Bitcoin whale bets on BTC, ETH correction with $900M shorts

In one of their first moves in two months, the Bitcoin whale returned to short Bitcoin and Ether for hundreds of millions of dollars, betting on their short-term price decline.

A large cryptocurrency investor who surfaced two months ago with about $11 billion worth of Bitcoin has opened almost $900 million in short positions against Bitcoin and Ether, signaling expectations of a market correction despite widespread optimism for October.

The whale returned to trading on Thursday with a $360 million Bitcoin (BTC) transfer that piqued the interest of cryptocurrency investors, Cointelegraph reported.

On Friday, the whale opened a $600 million 8x leveraged short position on Bitcoin and a leveraged short worth over $300 million on Ether (ETH), according to blockchain data platform Onchain Lens.

The massive short bets signal the whale‘s confidence in an incoming correction, but the thesis stands to be invalidated if Bitcoin’s price rises above $133,760, their liquidation threshold.

Source: Onchain Lens

The whale also opened a $330 million 12-times leveraged short position on Ether, with a liquidation price of $4,613. The position showed an unrealized profit of $2.6 million at the time of writing, according to blockchain data shared by Lookonchain on Friday.

Source: Lookonchain

The whales short bets may inspire more large investors to follow suit and bet on the price decline of the leading cryptocurrencies.

Back in August, nine whale addresses acquired a cumulative $456 million worth of Ether, after the $11 billion Bitcoin whale rotated $5 billion of his Bitcoin into ETH.

Large-scale selling from previously dormant Bitcoin whales was among the main factors limiting Bitcoins price action in August, according to analyst and early Bitcoin adopter Willy Woo.

Bitcoin correction caused by smaller cohorts, not whales

Bitcoin set a new all-time high above $125,700 on Sunday, before retracing to trade above $121,350 at the time of writing, according to Cointelegraph data.

The majority of the selling pressure didn‘t come from large investors, but smaller wallet cohorts, including 603 Bitcoin sold by shrimp addresses, 2,260 Bitcoin sold by crabs and 3,860 BTC sold by fish addresses, according to blockchain insights platform CryptoQuant’s Thursday X post.

Source: CryptoQuant

The shrimp cohort refers to retail investor addresses with less than 1 Bitcoin. Crab addresses hold up to 10 Bitcoin, while fish addresses hold between 50 to 100 BTC.

Most cryptocurrency traders are also positioning for a short-term decline in the crypto market.

Long vs short trades on exchanges. Source: coinAnk.com

Over 52% of Bitcoin holders across all exchanges are currently short, meaning that they are betting on Bitcoins price decline, while 47% remain long, according to blockchain data from CoinAnk.

About 51% of Ether traders have also shorted the worlds second-largest cryptocurrency, expecting a decline.