Whale risks $27.53M PEPE liquidation on Hyperliquid

A crypto whale has placed a high-stakes 10x leveraged long position worth $27.53 million on the PEPE (CRYPTO:PEPE) meme coin through the Hyperliquid (CRYPTO:HYPE) platform, exposing themselves to significant risks amid volatile market conditions.

The trade, initiated on March 24 at an entry price of $0.00814 per 1,000 PEPE, has already resulted in unrealised losses of $3.238 million.

The whale, identified via the address 0x507…BeDb6, faces liquidation if PEPE’s price drops to $0.005219.

To delay forced liquidation, the trader added $3.818 million in margin, signaling their commitment to defending the position despite mounting pressure.

Analyst Ai highlighted that using 10x leverage amplifies both potential gains and losses, making this bet highly unstable.

Even minor price fluctuations could trigger cascading sell-offs across the market.

If liquidation occurs, Hyperliquid’s automated systems would close the position, potentially exacerbating PEPE’s price decline and leading to broader market instability.

“Meme coins like PEPE are particularly vulnerable to rapid price swings driven by social sentiment rather than fundamental value,” noted Ai.

This volatility heightens the risk for leveraged traders and could lead to a feedback loop of sell-offs.

The whale’s actions have raised concerns about potential market manipulation, as large-scale traders often influence trends through direct trades or sentiment shifts.

While adding margin may temporarily stabilise PEPE’s price, a sudden exit could spark panic among smaller traders and further destabilise the market.

Meanwhile, similar leveraged positions in other cryptocurrencies are facing challenges.

Another trader known as CBB opened a 10x leveraged long position on Ethereum (CRYPTO:ETH) worth $2.11 million but is grappling with unrealised losses of $1.035 million due to unfavorable market conditions.

These developments underscore the dangers of excessive leverage in declining markets.

As PEPE’s whale struggles to maintain their position and Ethereum traders face mounting losses, analysts warn of increased volatility in the crypto sector in the coming days.

At the time of reporting, the Pepe (PEPE) price was $0.000006943, and the Hyperliquid (HYPE) price was $12.46.