On February 8, 2026, at 8:00 AM UTC+8, Trend Research, an institution under Yi Lihua, concentrated its trading in just 20 minutes, selling 20,770 ETH, equivalent to approximately $43.57 million at the time, leaving a striking liquidity impact on-chain. After the sell-off, its visible ETH position on-chain was only 10,303 ETH (about $21.5 million), which is almost a "liquidation-style contraction" compared to the previous scale of several hundred thousand ETH. According to on-chain calculations from a single data source, Trend Research's cumulative unrealized loss on this round of ETH operations is approximately $747 million. This figure is not an exact settlement but is derived from the average cost of withdrawals and deposits. During the same period, the market's fear and greed index fell to 7, an extreme panic zone, intertwining institutional self-rescue sell-offs with emotional stampedes, bringing the main theme of "fear overcoming rationality" to the forefront.

Full Replay of the 20-Minute Sell-off of 20,000 ETH

● Timing Rhythm: On-chain data shows that the sell-off on February 8 was highly concentrated within a window of about twenty minutes, with Trend Research placing orders or matching transactions for 20,770 ETH in batches, completing a deleveraging reduction in a very short time. This rhythm is distinctly different from conventional institutional dispersed trading, resembling a "quick liquidation" with a preset goal, aimed at compressing uncertainty within a single trading period.

● Scale Comparison: Before this concentrated sell-off, Trend Research had accumulated an operational scale of several hundred thousand ETH through records of withdrawals and deposits from Binance, while only 10,303 ETH remained on-chain after February 8, indicating that its ETH position sharply decreased from "super whale level" to a medium-sized address in a short time. This drastic contraction from several hundred thousand to just over ten thousand is a strong signal of risk aversion and position bleeding.

● Market Position: In terms of overall daily market transactions, 20,770 ETH would not "break" the entire market under the current liquidity environment, but this concentrated selling pressure undoubtedly added to short-term volatility given the relatively weak market depth at the time. While it is difficult to precisely quantify its specific impact on price, it is certain that it occurred during an already intensifying panic downtrend, reinforcing the subjective feeling of "adding heavy blows during a decline."

From Withdrawal to Deposit: An Arc from High Positioning to Low Loss Recognition

● Capital Trajectory: According to on-chain statistics, Trend Research had withdrawn 792,532 ETH from Binance, with an average cost of about $3,267, indicating that it continued to increase its position during the rising and high volatility phases, with an overall entry point being relatively high. Subsequently, as the market weakened and liquidity tightened, the institution deposited 772,865 ETH back to Binance, with an average price of about $2,326, significantly lower than the previous withdrawal cost.

● Unrealized Loss Calculation: By comparing the average prices of withdrawals and deposits, a rough estimate of the unrealized loss range can be inferred. Using $3,267 and $2,326 as anchor points, combined with the scale of over 700,000 ETH, the $747 million loss figure provided by on-chain analysis institutions is essentially a single-source estimate based on average cost and quantity, not including the precise profit and loss of each transaction. Due to the lack of complete transaction details, this figure resembles a "magnitude judgment" rather than a result that can be used for settlement.

● Market Background: If we place this capital trajectory back into the macro market context of the past year or two, Trend Research's behavioral arc is very typical—massive withdrawals for position building during the late stages of a rise and high price range, followed by gradual deposits during the downturn and cooling of sentiment, ultimately choosing to sell off significantly and recognize losses during extreme panic. This path from "high position acquisition" to "low position stop-loss" closely resembles the outcomes of many leveraged institutions in the previous crypto cycle, except this time, the entire process was starkly recorded on-chain.

Institutional Fear and Greed Under Extreme Panic Readings

● Historical Comparison: The fear and greed index dropping to 7 is approaching historical emotional lows seen in June 2022 and August 2019. Looking at these extreme values, the market was in a phase of "intense bad news, tight liquidity, and collapsing participant confidence," while prices had often already experienced multiple rounds of declines. In such an emotional environment, combined with large institutional sell-offs, it easily creates a psychological suggestion of "history will repeat itself," amplifying panic resonance.

● Rational Dislocation: Theoretically, institutions, due to having richer tools and longer assessment periods, are expected to be more rational during extreme emotions. However, in practice, when net value drawdowns amplify and pressures from capital providers and public opinion accumulate, institutions can also be swept up by herd mentality and stop-loss discipline, even executing "cutting losses" mechanical rules more firmly than retail investors. Trend Research's concentrated liquidation when the index reading was only 7 is likely a result driven by this "institutional fear."

● Symbolic Significance: For retail investors, seeing institutions once regarded as "smart money" choose to recognize losses and exit at emotional lows can easily be interpreted as a negative signal of "even the whales can't hold on." This could further undermine holding confidence in the short term. However, from another perspective, it also exposes that institutions can also make less than ideal trading decisions under pressure, breaking the myth that "institutions will always outperform individuals," helping to recalibrate market expectations and narratives regarding different participants.

Hayes' Perspective: Leverage Liquidation and Chip Restructuring

● Volatility Amplifier: Arthur Hayes has emphasized that "BTC derivatives do not cause price volatility itself, but only amplify price volatility in both directions." This logic also applies to ETH; when the spot trend is already downward, the passive liquidation and forced reduction of high-leverage longs can magnify what would have been a controllable pullback into severe fluctuations. In such an environment, any large sell-off will intertwine with the chain reactions on the derivatives side, forming a feedback loop of "liquidations during declines and further declines during liquidations."

● Deleveraging Link: Hayes also pointed out that "the cryptocurrency market can quickly clear out over-leveraged investors." From this perspective, Trend Research's significant exit this time is likely part of the overall market deleveraging process—regardless of whether it used explicit leverage, its behavior trajectory of massive entry at high levels, enduring declines during downturns, and ultimately recognizing losses during extreme panic resembles that of typical overexposed risk investors. This "cleansing" driven by market prices and institutional constraints may manifest as severe losses in a short time, but for the entire system, it accelerates the clearing of weak positions.

● Risk Release: From a longer-term perspective, institutional massive losses and concentrated sell-offs are often seen as nodes for a new round of chip redistribution. Whales like Trend Research exiting at low levels means that the sold ETH will inevitably be taken over by buyers who are more willing to endure volatility, have lower capital costs, or possess a longer-term perspective. While it is difficult to quantify the specific impact of this event on price, it is reasonable to infer that such deleveraging and turnover behaviors will transfer risk from high-sensitivity participants to groups with stronger capacity to bear pressure, potentially laying a healthier position structure for the next phase of the market.

On-Chain Perspective: When Whales No Longer Sit Steadily

● Behavioral Characteristics: From address migration and transaction paths, Trend Research, as a whale address, has shown a typical rhythm of "concentrated withdrawals—dispersed deposits—concentrated sell-offs" over the past period. Initially, large amounts were withdrawn from exchanges and transferred to controlled addresses or cold wallets; as the market weakened, it reinjected chips back into exchange addresses in multiple transactions to prepare for subsequent reductions; ultimately, on February 8, it completed a "quick in and out" style concentrated sell-off, with the entire process being clear and highly traceable.

● Unusual Rhythm: Traditionally, institutions often choose more discreet and dispersed methods to adjust positions to avoid exposing intentions in the public market and causing unnecessary price impacts. However, Trend Research's high-intensity concentrated sell-off in a short time clearly deviated from the conventional practice of "batching and low profile," resembling a forced choice under time and risk control pressure to sacrifice some trading efficiency and concealment for the certainty of quickly reducing exposure. This unusual rhythm of "exchanging action for time" itself indicates the significant internal pressure they faced.

● Emotional Signals: With the proliferation of on-chain analysis tools, such traceable large address behaviors are increasingly viewed by market participants as emotional signals and trading indicators. Concentrated sell-offs by whales are interpreted as amplifiers of "institutional pessimism," while whale entries are often packaged as optimistic narratives of "smart money bottom-fishing." In the Trend Research incident, the on-chain real-time exposure of the reduction trajectory accelerated the dissemination of information in the market and objectively intensified the spread of panic, reminding us that on-chain transparency is both an information advantage and a new channel for emotional amplification.

After Institutional Liquidation: Who is Picking Up the Pieces of This Panic?

Trend Research's large-scale liquidation is a heavy blow to the market myth that "institutions are necessarily smarter." It shows that in the highly volatile and extremely transparent crypto market, so-called "smart money" can also make heavy bets at the wrong time and price, and recognize losses at low levels under the dual pressures of emotion and institutional constraints. In the medium to long term, the combination of extreme panic readings and whale exits often signifies that the most vulnerable positions are being forced to hand over, with chips flowing from high-cost anxious holders to low-cost patient ones, creating space for subsequent emotional recovery and trend reconstruction. What individual investors should truly focus on are verifiable on-chain data and clear funding trajectories, rather than vague second-hand opinions or stories amplified by emotions. In the face of such extreme events, maintaining sensitivity to data and a skeptical spirit towards narratives is far more important than following any side's emotions.

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