Key Takeaways
What’s happening with the Ethereum whale?
A whale entity borrowed 64,000 ETH [around $280 million] from Aave using $420 million in USDC as collateral.
What does this move mean for Ethereum?
The move signals growing bearish sentiment following ETH’s drop below $3,900.
A major crypto whale has just opened one of the largest short positions on Ethereum in months, according to on-chain data shared by an analyst.
The entity supplied $420 million in USDC to the Aave lending protocol and borrowed 64,000 ETH, worth roughly $280 million.
Shortly after, the borrowed ETH was transferred to Binance, suggesting that the whale intends to sell it immediately on the open market.
This type of transaction, borrowing an asset and moving it to an exchange, is a classic setup for a short position. The trader profits if ETH’s price falls and can later buy back the ETH at a lower price to repay the loan.
Ethereum market sentiment turns cautious
The large short aligns with a broader shift in market sentiment. Data from Coinglass shows Ethereum’s long/short ratio at 0.98, with shorts making up 50.4% of leveraged positions as of 20 October.
This slight dominance of short positions reflects a growing sense of caution among traders following ETH’s decline in the last seven days.
The token is now trading around $3,950, down from early-October highs above $4,300.
Source: Coinglass
If the price continues to slide, this whale could see substantial profits. However, a sharp rebound could trigger liquidations, forcing the position to close at a loss, a scenario that might fuel a short squeeze.
At the current price, short liquidation is approximately $80 million, while the long position is valued at almost $60 million.
Context: Rising volatility and macro uncertainty
Ethereum’s downturn mirrors the broader market weakness that followed last week’s Bitcoin-led correction.
The overall crypto market cap has seen some declines in the past seven days, pushing the Fear and Greed Index deep into “fear” territory.
Traders now watch to see if this whale’s move marks the start of wider institutional short positioning, or if it sets the stage for a potential rebound driven by oversold market conditions.
As of this writing, Ethereum remains under pressure, but funding rates across major exchanges remain positive.
