The liquidation margin is only $1,600. This $200 million BTC short trader is playing with fire.

According to the latest news, a liquidation trader shorted 510 BTC (worth approximately $47.3 million) during the decline at 7:00 AM on January 20, expanding their short position to $200 million. More alarmingly, this trader’s BTC short position is only $1,600 away from liquidation price, and their ETH short is only $56 away from liquidation price. Given the current BTC price of $92,764, any small rebound could trigger a chain of liquidations.

Aggressive Shorting Under Extreme Risk

How close is the liquidation price

Based on data, this trader’s risk status has reached a critical point:

• BTC short: liquidation price only $1,600 away (1.7% of current price)
• ETH short: liquidation price only $56 away (even greater risk)
• Total position: $200 million in shorts

This means that as soon as BTC rebounds by $1,600 to $94,364, or ETH rebounds by $56, this trader will face liquidation. Considering the volatility of the crypto market, this distance is no longer a “safety cushion” but a “trigger line.”

Logic of chasing shorts

From the timing perspective, this trader chose to short during the decline at 7:00 AM, indicating a bullish outlook on the bearish trend. However, increasing the position while shorting suggests they are using unrealized gains to further leverage — a high-risk liquidation roll-over.

Related information shows that similar high-leverage short traders have been quite common recently. On January 19, a trader expanded a $3 million principal to a $152 million short position, with actual leverage reaching 35x, ultimately approaching liquidation price as well.

Market Signals and Risk Warnings

Hidden dangers of high leverage concentration

Recent on-chain data over the past week reflects a phenomenon: short traders are increasing leverage and expanding positions. This may imply:

• Market participants have divergent views on future trends
• Some aggressive traders are betting on bearish moves
• High leverage positions are concentrated, and once triggered, could cause chain reactions

Risk of liquidation cascade

If BTC rebounds and triggers this trader’s liquidation, their $200 million short will need to be closed. This could further push BTC prices higher, potentially triggering liquidations of other high-leverage shorts, creating a “domino effect.”

Summary

This trader’s actions exemplify the typical characteristics of high-leverage trading in the crypto market: continuing to add to winning positions and treating the liquidation price as an ignorable risk. The $200 million short, $1,600 liquidation distance, and $56 ETH liquidation distance all point to the same fact — this is an extreme operation.

It is worth noting that such concentrated high-leverage phenomena have been appearing more frequently recently. For ordinary investors, this is not a “spectator” moment but a warning — when extreme leverage concentration occurs in the market, contrarian volatility can come very quickly.