Big Brother's Hyperliquid Empire Collapses in $12M Run
Key Summary
Machi Big Brother's leveraged trading account on Hyperliquid exchange wiped out $12.25 million in four months, with a subsequent liquidation wiping out most of his fortune, leaving him with $21,800. The collapse highlights the risks of high-leverage trading and market volatility.
Background
Machi Big Brother's Hyperliquid trading account fell to about $21,800 on October 15 after a series of liquidations wiped out most of a fortune that had climbed from roughly $56,000 to $12.25 million in four months.
The Collapse
The collapse followed another round of Ethereum price declines, leaving the trader with a fraction of his previous balance after repeated attempts to cut losses and keep positions open.
Historical Context
A derivatives selloff and macro pressure contributed to the decline, which also saw Bitcoin fall below $81,000 and Ethereum approach $2,380.
Scale of Trading
The market context around a large Hyperliquid Ethereum position underscores the scale of derivatives trading on the venue.
Repeated Losses
This is not the first time the trader has suffered heavy losses on Hyperliquid, a decentralized exchange that supports leveraged derivatives trading.
Conclusion
The incident highlights the need for traders to assess each position on its own evidence and not rely on market sentiment alone.
The incident serves as a reminder of the importance of risk management in leveraged trading.
Lessons Learned
Public blockchain trackers have documented hundreds of liquidations tied to the account, with losses running into tens of millions of dollars.
Looking Ahead
The trader has also faced substantial losses outside perpetual futures. In August, he proposed buying Friend.tech for $1 million and relaunching its FRIEND token, of which he had bought 11 million units for about $16.7 million, only to see their value drop to less than $500,000.