$500K+ Loss After Ethereum Gets Wiped Out on 25x Leverage — What We Learned from This Trade

A significant liquidation event just unfolded in the crypto markets. According to HyperInsight intelligence released on December 26, an Ethereum whale address known as “Friendship” (associated with Huang Licheng) suffered a catastrophic loss exceeding half a million dollars when their highly leveraged position got liquidated at an unfavorable price level.

The Trade Details That Went Wrong

The position consisted of 8,100 ETH purchased at an entry price of $2,972.52, amplified through 25x leverage. The liquidation trigger hit when Ethereum price dipped to $2,870.73—a relatively modest price movement of just over $100, but devastating when multiplied by 25x.

The math is brutal: a roughly 3.4% adverse price swing was enough to completely wipe out this position. This single trade alone demonstrates why leveraged trading on crypto remains one of the highest-risk financial activities.

Pattern of Consecutive Losses

This liquidation didn’t happen in isolation. The same address has been hemorrhaging capital consistently, losing approximately $500,000 just within the past seven days alone. Over the previous month, accumulated losses reached $3.91 million—a staggering figure that reveals the compounding dangers of sustained leveraged betting against market volatility.

The Leverage Trap in Crypto

Events like these are critical reminders of why 25x leverage is essentially a double-edged sword. While amplified returns are theoretically possible during favorable price movements, even slight adverse ticks can trigger cascading liquidations. For ETH traders, this becomes especially risky during periods of sideways or choppy price action where whipsaw events are common.

The current Ethereum market environment demands careful position sizing and strict risk management. Traders continue to test the limits of derivative markets, but the losses speak louder than any success story.