A massive price drop in MON has left one of the biggest traders with a balance of zero after losing all of his position in MON as the token dropped 47% in just a few days after launch.
Trader address 0xccb5 saw his 244.38 million MON long position worth $6.5M fully liquidated after sharp downward pressure on the price.
The loss amounts to $1.9 million, a devastating result in a time of heightened volatility and growing uncertainty with the token.
The liquidation took place as MON fell 47% from $0.049 to $0.0279 in just a few days. The 4-hour RSI has now settled itself at 39, with weakening momentum that indicates sustained bearish pressure.
Market Moves As MON Faces Sharp Sell-Off
Market sentiment has turned against MON in a short period of time, and aggressive selling has been increased following recent speculations around valuation and future performance of the project.
Liquidity dried up as the acceleration of falling prices led to cascades of leveraged liquidations. The full liquidation of the 0xccb5 account shows the risks associated in leverage trading.
Public Confrontation Between Arthur Hayes and Monad Founder Increases Tension
The price meltdown comes after a public debate over Twitter between Arthur Hayes, founder of BitMEX, and Monad creator, Keone Hon, after Hayes predicted that MON will fall 99% off their highs.
Hayes posted a very critical view of MON’s token structure and long-term sustainability that attracted considerable attention from investors and analysts throughout the sector. In response, Keone Hon published a comprehensive answer to the major areas of concern.
He made it clear that the annual inflation is fixed at 2%, which is much lower than many other competing Layer-1 blockchains, and stressed that vesting tokens are not eligible for staking (limited dilution immediately, which relieves early unlock pressure).
Hon said critics were misinterpreting token data while also failing to see the technical merits of the mainnet release.
Debate Raises Questions but Also Highlights Project Strengths
While the confrontation put additional pressure on a market already in turmoil, it also brought important elements of a structural analysis into the light for the long-term holder.
The posts seen from the Monad’s leadership enforced the perspective that inflation control and staking restrictions, as well as planned technical development, may be contributing to the long-term sustainability of the network.
Investors that have retained confidence continue to say that it is necessary to evaluate adoption and utility over time rather than short-term price fluctuations.
For now attention is focused on the ability of MON to stabilize after strong liquidation pressure or if market sentiment will be bearish.
With the leverage quickly working its way out of the system, the next price reaction could be the difference between the worst of the selling being over or lower levels being possible.
The collapse acts as a reminder of the extreme volatility of the leveraged crypto markets, where large positions can turn to liquidation in a short amount of time and sentiment can change in minutes.