While the market celebrates Bitcoin's record weekly rally, major market maker Wintermute is demonstratively strengthening its bearish bets. On August 23, the company increased its short positions on the decentralized exchange Hyperliquid from $146.19 million to $190.77 million. Thus, over a short period of time, roughly $44.58 million in shorts were added — a signal that cannot be ignored.
Structure of bearish positions
Analysis of the distribution shows that the main blow is aimed at market leaders. The largest short position is on Ethereum — $53.02 million, followed by Bitcoin with $30.66 million. The top 5 also includes Solana ($22.62 million), Hyperliquid's native token HYPE ($11.43 million), and XRP ($10.19 million). Such a diversified approach points to a systematic strategy rather than targeted hedging.
Institutional footprint: $603 million in shorts
Notably, after the recent price surge, most large shorts were liquidated. However, hedging accounts of institutional players remain on the horizon. According to my observations, Abraxas Capital, Fasanara Capital, and Wintermute collectively hold short positions of 138,569 ETH (about $338 million) and 3,425 BTC (approximately $265 million). The total volume of these bets reaches $603 million.
Unrealized losses deserve special attention. For Abraxas Capital, they amount to about $58 million across four positions in BTC and ETH, while for Fasanara — approximately $16.6 million. At the same time, Wintermute is near the breakeven level on the two leading cryptocurrencies, indicating a more precise entry into positions.
Liquidation levels and current market conditions
Liquidation levels remain a critical factor, significantly exceeding current quotes. For Abraxas' Ethereum positions, they are set at $4,008 and $3,958, and for Bitcoin — $128,521 and $140,437. For Wintermute, the liquidation level on digital gold is around $251,307. At the time of writing, Bitcoin is trading around $78,100, and Ethereum is near $2,500.
Let me remind you that from August 17 to 23, the first cryptocurrency rose by $14,264, setting a historical weekly record. However, the actions of Wintermute and other institutional players make one wonder: is the current rally a trap for retail traders?
My expert commentary: Such behavior by market makers is a classic sign that smart money sees an overheated market. Given that liquidation levels on shorts are 40-50% above current prices, these positions are unlikely to be closed in the near future. I would recommend investors to remain cautious and not give in to euphoria, especially when opening long positions at current levels.