On-chain analyst Yu Jin has flagged a whale address on Aave that holds a leveraged long position of 58,000 ETH, currently valued at $93.66 million. If Ether (ETH) drops another $40 to $1,555, the position will be liquidated.
At the current market price of around $1,595, the whale is just 2.5% away from its liquidation threshold. Aave is a leading DeFi lending protocol that allows users to borrow against collateral to amplify long exposure. Once the price hits the preset liquidation line, smart contracts automatically close the position to repay the debt.
Aave's liquidation mechanism triggers when a position’s health factor falls below 1, meaning collateral value is insufficient to cover the borrowed amount. Third-party liquidators can then step in to repay part of the debt and claim the collateral as a reward. Due to the whale’s high leverage, the liquidation price is dangerously close to the current market, prompting continued monitoring by on-chain analysts.