Ethereum Whale Suffers $49M Loss from Long ETH/BTC Position

Ethereum (ETH) investor James Fickel, known for his consistent bullish outlook on ETH, has faced significant losses from his long position on the ETH/BTC trading pair.

Recent transactions indicate that Fickel swapped 11,584 ETH for 450 wrapped Bitcoin (WBTC), worth $27 million, for 0.03881. This is part of a series of trades that have led to heavy losses. His portfolio is currently under strain due to a drop in the ETH/BTC rate.

James Fickel(@jamesfickel) exchanged 11,584 $ETH for 450 $WBTC($27M) at 0.03881 again in the past 10 hours.

He still has 1,308.8 $WBTC($78.8M) in debt on #Aave.

Currently, he has lost over 21K $ETH($49M) by going long on the BTC/ETH trading pair!https://t.co/mCnKF8pdE5 pic.twitter.com/30Ej4g3tJw

— Lookonchain (@lookonchain) September 18, 2024

Fickel’s total losses have now surpassed 21,000 ETH, equating to around $49 million from his long position on the ETH/BTC pair. Moreover, he still holds a $78.8 million debt in WBTC on Aave, further adding to the pressure on his portfolio.

Ethereum’s Persistent Struggles Against Bitcoin

Fickel’s trading approach involved borrowing large amounts of WBTC to trade for ETH. From January 10 to July 1, he borrowed 3,061 WBTC, valued at $172 million, from Aave.

He used the borrowed WBTC to buy 56,445 ETH at a rate of 0.05424, aiming to benefit from favorable market conditions. However, Ethereum’s continued underperformance against Bitcoin has resulted in considerable losses in his trading positions.

In August, Fickel pursued the same strategy, using 12 million USDC to acquire 211 WBTC, and swapping 16,000 ETH for 671 WBTC, valued at $39.9 million, at a rate of 0.042. These trades were primarily aimed at repaying his outstanding debt on Aave.

Analysis reveals that aside from his losses, he is grappling with a debt of approximately 2,196 WBTC, or $132 million, on Aave.

ETH/BTC Drops Below 0.04

Despite diversifying across other DeFi platforms like LIDO, Curve, and Harvest, Fickel’s portfolio remains heavily influenced by the ETH/BTC pair.

On Monday, the ETH/BTC rate dropped below 0.04, hitting its lowest point since April 2021 and continuing the downturn that began in September 2022. Analysts attribute the decline to a combination of technical and fundamental factors, suggesting that Ethereum’s underperformance could have broader implications for the altcoin market.

A lot of people holding large bags of altcoins are mocking #ETH / #BTC right now.

But history shows that when ETH/BTC crashes, the ALTs will follow. pic.twitter.com/USqLJc2u80

— Benjamin Cowen (@intocryptoverse) September 16, 2024

As Ethereum struggles against Bitcoin, they believe other altcoins may follow a similar downward trend. Historically, altcoins have tended to move in sync with Ethereum. With the ETH/BTC pair approaching a bottom, further declines could signal a potential correction in the broader altcoin market.