On February 2nd, in the context of a sharp decline in ETH prices and a surge in liquidations across the network, the institution Trend Research initiated a large-scale deleveraging operation: on one hand, it sold over 33,000 ETH to stop losses, and on the other hand, it withdrew nearly 80 million USDT to repay loans, lowering the liquidation price of its massive leveraged positions. This institution, regarded as an "ETH whale," is both a provider of liquidity and an amplifier of volatility. When stop-loss orders hit weak buy orders, loans are repaid in concentration, and the overall liquidation price drops, market panic and liquidity pressure begin to reinforce each other—while the whale seeks to save itself, the entire market continues to be pushed into a turbulent deep water zone by the whale's actions.
79,000 ETH Stop-Loss and Liquidation Price Adjustment
● On-chain path of stop-loss and debt repayment: On February 2nd, Trend Research sold 33,589 ETH during the ETH crash, amounting to approximately $79.12 million at the time, while also withdrawing about $77.52 million USDT from Binance to repay loans. This series of operations is reflected on-chain as a continuous action of massive ETH outflow, USDT inflow, and debt repayment, marking its decision to no longer "stubbornly hold through the correction," but rather to actively stop losses and concentrate repayments to quickly reduce leverage.
● Comparison with overall position size: According to data from a single source, Trend Research still holds about 618,000 ETH, valued at approximately $1.43 billion, with outstanding leveraged loans of about $941 million. Given this scale, selling over 33,000 ETH and using more than $77 million USDT to repay debts resembles a "partial bloodletting" risk contraction rather than a full-scale exit, highlighting a phase of defensive positioning against extreme market conditions rather than a complete withdrawal from the long-term bullish narrative on Ethereum.
● The double-edged effect of lowering the liquidation price: Through stop-loss and debt repayment, Trend Research reduced the overall liquidation price of its ETH lending position from about $1,880 to $1,830. Nominally, this created a "safety buffer" of about $50 for the account, reducing the probability of being concentratedly liquidated in a short time. However, in an environment of increased ETH volatility and amplified downward slope, this $50 range is not a solid wall but more like a buffer zone that delays the triggering of tail risks; once the market continues to probe lower, the threat of concentrated liquidation remains real.
Unrealized Loss of $562 Million and the Life-or-Death Decision of Risk Control
● Realized losses and unrealized losses: Statistics show that Trend Research has incurred cumulative losses of about $562 million during this operation and previous volatility, with realized losses of about $27.71 million, while the rest remains as unrealized losses hanging over its massive positions. Realized losses mean a permanent loss of real money, while unrealized losses theoretically still have the possibility of being "recovered" through rebounds, which is the psychological root of why leveraged bulls often hesitate to stop losses and prefer to hold on.
● The tug-of-war between passive liquidation prevention and active stop-loss: In a high-leverage environment combined with a one-sided decline, institutions face a dilemma—on one hand, passively waiting for liquidation often means being forcefully liquidated at the worst price during the worst liquidity moments, making losses hard to control; on the other hand, actively stopping losses requires "pulling the trigger" amidst severe volatility, enduring the immediate pain of locking in losses, and the opportunity cost of missing potential rebounds. Trend Research's large stop-loss and liquidation price adjustment essentially represents a choice to accept temporary bleeding in exchange for greater control over the fate of its overall positions.
● The necessity and cost of reducing leverage ratios: From the perspective of institutional risk control, in the context of severe ETH price volatility and outstanding leverage of about $941 million, reducing leverage ratios is almost a "prerequisite for survival." Reducing liabilities and lowering liquidation prices can decrease the probability of cascading liquidations in extreme market conditions, but the cost is the potential forced sale of originally planned long-term holdings, compressing the potential profit space at high levels into current certain losses. For a high-volatility asset like Ethereum, this operation of exchanging long-term holdings for short-term safety represents the sharpest conflict between risk control discipline and long-term faith.
On-Chain Public Execution and Information Overload Panic
● Live broadcast of large position changes: Under the on-chain transparency mechanism, the actions of whale addresses like Trend Research are exposed to public view. The outflow of tens of thousands of ETH, the inflow of tens of millions of USDT, and the adjustment of lending position liquidation prices on February 2nd were all marked, forwarded, and interpreted in real-time by on-chain analysis accounts. For the community familiar with address labels, this is almost a "public execution-style" risk reenactment: every large transfer and every parameter change is immediately amplified into an emotional event.
● Institutional actions transmitting to retail sentiment: With the backing of publicly available liquidation prices and transfer records, institutional deleveraging is no longer a background accounting adjustment but becomes a "warning signal" visible to the entire market. When the community sees Trend Research lowering its liquidation price and stop-loss selling a large amount of ETH, many retail investors instinctively interpret it as "a deeper round of decline is about to come," leading them to sell or close leveraged positions in advance. This self-reinforcing expectation means that the deleveraging actions originally intended for defense may instead accelerate the release of short-term selling pressure.
● Comparison with traditional finance: In traditional financial systems, large institutions' forced liquidations and risk management often occur in relatively closed environments, where the outside world can only learn about them later through financial reports or news. In the crypto market, all liquidation thresholds, collateral changes, and large transfers are made public in real-time data, bringing unprecedented transparency but also triggering a kind of "information overload panic"—when every large transaction is seen as a signal, investors can easily amplify bad news and ignore noise, leading to overreactions.
Some Cut Positions While Others Buy the Dip: Opposing Market Dynamics in the Same Downtrend
● OG reduction and meme crash risk chain: Almost simultaneously with Trend Research's deleveraging, a veteran Ethereum OG wallet sold 8,691 ETH, cashing out approximately $20.1 million, while the price of the meme coin BULLA on the BSC chain plummeted over 90%. The former represents early large holders choosing to realize profits and reduce exposure amidst volatility, while the latter is a high-risk speculative asset that is the first to face "value zero" in panic, together outlining the instinctive response of capital under pressure—retreating from high-beta assets, flowing back to mainstream targets, or simply turning to cash to wait and see.
● Contrarian accumulation by whales: However, at the same time, there was a clear opposing force: some whales chose to increase their holdings by 15,642 ETH, spending about $36.24 million. In stark contrast to Trend Research's passive deleveraging and OG addresses reducing positions, these buying whales viewed the February 2nd crash as a "discount buying opportunity," willing to absorb selling pressure during heightened panic. On-chain, a highly torn picture emerges—one side is large positions stopping losses and being forced to reduce holdings, while the other side is patient capital placing orders, choosing to build a bottom.
● Who is forced out and who is patiently collecting: These mutually counteracting on-chain behaviors collectively shape the short-term liquidity structure of ETH. Institutions like Trend Research, exposed to high leverage, are more likely to be forced to reduce positions amidst volatility, acting as passive sellers in the market; while whales with low or no leverage can collect chips at low prices when selling pressure is released, turning others' stop-losses into their own positions. Market prices form in the tug-of-war between these two forces: the more people who cannot continue to hold and are swept out, the more it provides a source of chips for those who are patient and have cash.
From Kiyosaki to Whales: The 'Discount Bitcoin' Narrative and Leverage Reality
● Optimism and greed in the public discourse: Amidst this round of severe volatility, a completely different voice emerged on the other end of the public discourse. Robert Kiyosaki, author of "Rich Dad Poor Dad," publicly stated that he is "holding cash ready to buy more gold, silver, and Bitcoin at a 'discount'." This framing of the crash as a "discount promotion" has been continuously shared in the crypto community, reinforcing a narrative of long-term optimism and buying the dip, as if any decline is merely a limited-time offer prepared for long-term bulls.
● Long-term no-leverage faith vs. short-term high-leverage reality: If we juxtapose Kiyosaki's long-term bullish stance with Trend Research's current passive stop-loss and liquidation price adjustment, we can clearly see the vast differences in time dimension and capital cost. Kiyosaki's cash is unleveraged, with no liquidation line, theoretically able to wait indefinitely for price recovery; while Trend Research is backed by about $941 million in leveraged debt, and once ETH touches the liquidation range, the system will directly force liquidation without regard to cost. The former can treat volatility as a discount, while the latter must view volatility as a "life-or-death line for the account."
● The leverage boundary of the "buy the dip" slogan: In a high-leverage environment, "buying the dip" is not merely a matter of belief but a mathematical issue of liquidation probability. As long as there is a liquidation price, continuously adding positions in the wrong direction may accelerate reaching the life-or-death line rather than extending risk. Trend Research's case reminds the market: only under conditions of no leverage or very low leverage does "buying the dip" approach Kiyosaki's long-term investment logic; once high multiples of borrowing are added, this seemingly simple slogan can become the last straw that breaks the account.
The Next Chapter for ETH: Institutional Deleveraging and Market Bottom Dynamics
● Comprehensive impact on price, liquidation clusters, and sentiment: Trend Research's deleveraging operation on February 2nd, on one hand, directly dumped short-term selling pressure into the market by selling 33,589 ETH, pushing ETH prices closer to its liquidation range; on the other hand, by repaying about $77.52 million USDT in loans, it lowered its overall liquidation price from $1,880 to $1,830, reshaping the on-chain liquidation cluster distribution along with other high-leverage bulls. This "first increasing pressure, then defusing bombs" chain reaction intensified short-term panic but also, to some extent, released some systemic risks in advance.
● If prices continue to probe lower or remain stagnant for a long time: If ETH prices continue to probe lower, approaching or breaking below the $1,830 line, institutions like Trend Research may be forced to choose again: either further stop losses and accelerate the clearing of high-leverage positions; or risk being concentratedly liquidated while continuing to hold, betting on a quick rebound. If prices turn to remain stagnant for a long time, the cost pressure of leveraged funds will gradually amplify, potentially forcing them to reduce borrowing and lighten interest burdens. From a market structure perspective, the more high-leverage funds are forced to deleverage, the more favorable it is for bottoming, but the process is often accompanied by painful volatility cleansing.
● How to observe the entire deleveraging process: For ordinary participants, while the actions of a single whale are certainly eye-catching, they are not sufficient to form a complete market picture. More crucial is to continuously monitor large transfers across the network, ETH leverage data on major lending platforms, liquidation price distributions, and other comprehensive indicators to determine whether deleveraging is just beginning, ongoing, or nearing its end. Trend Research is merely a highlighted sample in this round of ETH crash; what truly determines the turning point of the market is when the overall market leverage levels complete a systemic retreat, and in this process, who is forced to hand over chips and who is quietly accumulating.
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