Trader risks $22M on massive Zcash short—Up $3.6M but liquidation looms

Key Takeaways

How much is the trader up on their ZEC short?

The whale has banked $3.6 million in unrealized profits on a $22.3 million short position.

What price levels could trigger liquidation?

With 10x leverage, liquidation occurs at around $792-$ 810; with 5x leverage, it happens near $864-$ 900.

A crypto whale has placed a substantial $22.3 million short bet on Zcash [ZEC], generating $3.6 million in unrealized profits as the privacy coin declines from recent highs. 

But the trade walks a tightrope—one wrong move could trigger a devastating liquidation.

Data reveals massive Zcash shorts

Arkham Intelligence data reveals that a whale wallet has been aggressively shorting Zcash for two days. The data showed that the wallet entered the positions as the token retested prices in the mid-$700s. 

The trader used both GMX Market and Hyperliquid to build the leveraged position, moving hundreds of thousands of USDC across multiple transactions.

The timing appears masterful. ZEC currently trades at $604.66, down nearly 14% from where the whale likely entered. That translates to roughly $3.6 million in paper profits on the $22.3 million position. 

However, paper profits mean nothing until realized—and leverage cuts both ways.

Why this trade could blow up

Zcash experienced a surge of over 1,500% in just two months, skyrocketing from around $50 in September to a peak of over $750 in mid-November. That parabolic move attracted massive speculation. 

Open interest in ZEC futures ballooned from $10 million to over $1.5 billion; a 150x increase that signals dangerous levels of leverage in the system.

Source: Coinglass

The trader bet this rally was unsustainable. So far, they’re right. 

Funding rates turned deeply negative around 15-16 November, meaning shorts pay longs to hold positions. When funding flips negative, it often signals bearish sentiment taking control.

However, here’s the danger: If the trader used 10x leverage with an entry near $720, liquidation occurs around $792-$ 810.

That’s just a 10% bounce from current levels. Even with more conservative 5x leverage, a move back to $864-900 wipes out the position entirely.

ZEC’s RSI currently sits at 61.11—neutral territory. The token could easily drop to the $500s before becoming oversold, giving the short more room to profit. 

Source: TradingView

Yet bounces are common after such dramatic selloffs, especially with $1.5 billion in open interest still sloshing around.

Generational trade or reckless gamble?

The whale’s wallet now holds approximately $1.6 million in assets, heavily weighted toward USDC stablecoins. This suggests they may have already taken partial profits or are managing risk carefully.

The next few days will determine whether this trader nailed a once-in-a-cycle short—or becomes another cautionary tale about playing with leverage at crypto’s extremes.