Friday, February 3, 2023

Rekt: Crypto Exchange OKEx Beholds $119 Million Short Squeeze

Rekt: Crypto Exchange OKEx Beholds $119 Million Short Squeeze

As first pointed out by trading group BTCVIX, an absolute whopper of a liquidation has occurred on cryptocurrency exchange OKEx, where a trader just saw short position on bitcoin squeezed to the tune of ~$119 million USD. It’s one of the largest short squeezes to date in the ever-maturing cryptoverse. 

Also see: Ladies and Gents: Bitcoin’s Officially on the Fed’s Mind

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R.I.P. Anonymous Shorter

Crypto exchange OKEx, which allows for margin trading on its platform, just saw the king of short squeezes in the as-yet early cryptocurrency space.

An increase in buy pressure since mid-April has quickly pushed the bitcoin price toward flirtations with the $10,000 mark over the past few dozen hours. As such, trader group BTCVIX highlighted the latest upward market movement had busted an OKEx bitcoin shorter’s position in a mammoth way.

Now, it’s not clear how much leverage the trader was using on the positions — the most commonly espoused opinion in the space thus far has been that the shorter was likely using 10x leverage, meaning they would’ve tangibly lost around $19 million instead of the leveraged sum of $119 million if true.

Even still, a busted $19 million bet is downright painful.

#2 OKEx Shorter Also Rekt

After shorter numero uno went down, OKEx’s second largest shorter also had a massive position liquidated in short order.

BTCVIX estimates the second shorter “got blown out” to the tune of $73 million, so if they too were theoretically using 10x leverage, their actual loss would be ~$7.3 million.

Not a loss to scoff at either, to say the least.

It’s yet another reminder that when it comes to shorting in crypto, you either win big or you lose big. In these traders’ cases, really big.

What’s your take? Do you margin trade? If so, how do practice fiscal discipline with the risks involved? Let us know how you approach leverage in the comments below. 

Images via ATLANT, Bulls on Wall Street

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