In a stunning development that has captured the attention of the crypto trading community, a well-known high-win-rate trader, previously reported to have earned over 17.55 million USD in profits on Hyperliquid, has made a dramatic return to the market. According to a recent post by Ai Yi on social media, this trader, often referred to as the 'Hyperliquid legend,' re-entered the scene with a massive 40x leveraged short position on Bitcoin (BTC) worth nearly 92.66 million USD. The trade was initiated just 8 hours prior to the post timestamped at May 12, 2025, with an opening price of 104,094.2 USD per BTC. The liquidation price for this high-stakes position is set at 105,710 USD, and as of the latest update, the trader is sitting on a floating loss of approximately 130,000 USD. This bold move comes after the trader deposited 2 million USDC as collateral on Hyperliquid, signaling confidence in their bearish outlook on BTC. This event coincides with a volatile period in the broader financial markets, where stock indices like the S&P 500 have shown choppy price action, declining by 0.8% on May 11, 2025, as reported by major financial outlets. Such stock market weakness often influences risk assets like cryptocurrencies, potentially amplifying the impact of large leveraged trades like this one. The crypto market itself saw BTC trading at around 104,200 USD on major exchanges like Binance at 10:00 AM UTC on May 12, 2025, with a 24-hour trading volume of over 35 billion USD, reflecting heightened activity amid this news.

The trading implications of this massive short position are significant for both retail and institutional players in the crypto space. A 40x leverage on a 92.66 million USD position means even a small upward price movement in BTC could trigger a liquidation event, potentially causing a cascade of sell-offs if the price approaches the 105,710 USD mark. Conversely, if BTC declines as anticipated by the trader, the profit potential is enormous, possibly influencing market sentiment to turn bearish. This trade also highlights the correlation between stock market sentiment and crypto assets. With the S&P 500 and Nasdaq showing bearish trends on May 11, 2025, with declines of 0.8% and 1.2% respectively as per market reports, risk-off sentiment appears to be spilling over into crypto markets. BTC and major altcoins like Ethereum (ETH), which traded at 3,800 USD with a 24-hour volume of 18 billion USD on Binance at 10:00 AM UTC on May 12, 2025, are under pressure. Traders might find opportunities in shorting BTC or related pairs like BTC/ETH on platforms like Binance or Hyperliquid, but the risk of a sudden reversal due to whale activity or macroeconomic news remains high. Institutional money flow could also shift, as stock market declines often push capital into safe havens, though some hedge funds might double down on high-risk crypto plays like this one.

From a technical perspective, BTC’s price action shows critical levels to watch. On the 4-hour chart, BTC is testing resistance at 104,500 USD as of 11:00 AM UTC on May 12, 2025, with the Relative Strength Index (RSI) hovering at 52, indicating neutral momentum. Trading volume for BTC/USDT on Binance spiked by 15% in the last 24 hours, reaching 35.2 billion USD by 10:00 AM UTC, suggesting strong market interest possibly driven by news of this massive short. On-chain metrics from platforms like Glassnode indicate a 3% increase in BTC exchange inflows over the past 48 hours as of May 12, 2025, hinting at potential selling pressure. Meanwhile, the stock-crypto correlation remains evident, with the S&P 500 futures dropping 0.5% in pre-market trading on May 12, 2025, per live market data. This trader’s position could exacerbate volatility if BTC breaches key support at 103,000 USD or resistance at 105,000 USD. For altcoins, ETH/BTC pair on Binance showed a slight uptick of 0.2% at 11:00 AM UTC, trading at 0.0365, suggesting some divergence in sentiment. Institutional impact is also worth noting—large trades like this often attract attention from funds monitoring crypto markets for volatility plays, especially as stock market uncertainty drives mixed risk appetite. This event underscores the interconnectedness of traditional and digital asset markets, offering both risks and opportunities for traders who can navigate the current landscape.

In summary, this high-profile trade not only highlights the audacity of leveraged trading in crypto but also serves as a reminder of the intricate links between stock and crypto markets. As institutional players watch these developments, retail traders should monitor key price levels, volume changes, and macroeconomic triggers closely. With BTC’s fate hanging in the balance near the 104,000 USD mark as of May 12, 2025, the next few hours could define whether this trader’s gamble pays off or leads to a spectacular liquidation event.

FAQ:
What is the significance of the 40x leveraged short on BTC?
The 40x leveraged short position worth 92.66 million USD on BTC, opened at 104,094.2 USD on May 12, 2025, represents an extremely high-risk, high-reward trade. A small price increase to 105,710 USD could liquidate the position, causing significant losses, while a drop in BTC price could yield massive profits for the trader.

How does stock market performance affect this BTC trade?
Stock market declines, such as the 0.8% drop in the S&P 500 on May 11, 2025, often lead to risk-off sentiment in crypto markets. This correlation could support the trader’s bearish outlook on BTC, though unexpected stock market recoveries or positive economic data could reverse the trend and jeopardize the short position.