Renowned Bitcoin trader Andrew Kang has suffered a massive loss of almost $567,000 in a single trading session, following the liquidation of his BTC/ETH long positions. Lookonchain, a smart money on-chain analyst, disclosed that Kang used up to 41x leverage on the trades, which many users believed was excessive. A screenshot of Kang’s trading activities attached to Lookonchain’s tweet revealed that he had three highly-leveraged BTC/ETH long positions in the trades.
Out of the three, only one position was profitable, which was the 32x leveraged BTC/ETH long, reflecting a $145,528 gain at the time of the report. The other two positions were leveraged at 40x and 41x and recorded respective losses of $270,763 and $295,836. The BTC/ETH trading pair has rallied for the past ten days with no significant pullback on the daily chart.
Many of Lookonchain’s respondents were surprised by Kang’s trade liquidation, as they believe that overleveraging was the only reason for such a significant loss under current market conditions. Some criticized Kang for not employing risk management procedures, while another indicated that his trading wallet had depleted from $5 million to below $1 million due to the liquidations.
At the time of writing, the BTC/ETH pair exchanged for $15.29, representing an 8.82% recovery from the local low of $14.07 as the pair surges toward the yearly high of $16.12 achieved on Wednesday, April 12, 2023.
This event highlights the importance of risk management in trading and the potential pitfalls of excessive leverage. As the cryptocurrency market continues to grow and attract more participants, traders must be cautious and responsible when engaging in high-risk trades. It is crucial to have a solid understanding of the market dynamics, employ effective risk management strategies, and avoid overleveraging positions to avoid significant losses.
