Trend Research has been left with a $686 million hole on its books after Ether fell below $2,000, wiping out much of a large leveraged position built over recent months. Arkham data cited in the report points to a paper loss of that scale as the firm’s bullish ETH trade came under pressure.
The trading firm, led by Liquid Capital founder Jack Yi, had reportedly assembled a roughly $2 billion long Ether position by borrowing stablecoins on Aave and using ETH as collateral. The structure was built around a positive long-term view on Ether. But the trade depended on price recovery. As ETH kept sliding instead, the collateral backing the borrowings shrank while the debt remained large, exposing the classic weakness of a looped leveraged strategy.
Price slide pushed the position into stress
The team had expected Ether to rebound quickly after dropping below $4,000 in October. That rebound never arrived. Selling pressure continued, and the decisive break came this month as ETH dropped sharply alongside Bitcoin. On February 4, Ether fell to $1,750, its lowest level since April 2025.
Bubble Maps said Trend Research then moved to unwind part of the position, liquidating more than 300,000 ETH. In a post on X, the data source said the group transferred 332,000 ETH, worth about $700 million, to Binance over five days to repay debt on Aave. The company now holds only 1,463 ETH, according to the report.
Jack Yi says sales were meant to control risk
Yi described the ETH sales as a risk-control move rather than a change in market conviction. In his X post, he said the firm remains bullish on the next crypto bull market and expects ETH to top $10,000 and BTC to exceed $200,000. He said the recent adjustments were made to manage exposure, while the broader outlook stayed intact.
Yi also called the current period a strong time to buy tokens and described volatility as one of the defining traits of the crypto market. He said many bulls have historically been forced out by sharp price swings before a stronger rebound followed. In this case, the trade shows how quickly a large ETH-backed borrowing strategy can break down once the collateral starts falling fast.