Crypto Whale’s $163M Bitcoin Short Sparks Insider Trading Fears

The crypto entity identified by blockchain address 0xb317 has emerged as one of the market’s most controversial figures, executing two massive short positions with uncanny timing that suggests potential insider information. Last week, the trader opened a nine-figure short position against Bitcoin merely 30 minutes before President Trump announced new China tariffs, capturing approximately $192 million in profits as markets crashed following the announcement. The precision of this trade immediately triggered accusations of insider trading across cryptocurrency forums and social media platforms, with many observers labeling the entity an “insider whale.”

The whale’s latest maneuver involves a $163 million short position opened on Sunday through Hyperliquid exchange, already showing $3.5 million in unrealized profit. Blockchain data reveals the trader employs 10x leverage on this position, creating significant risk with liquidation triggered if Bitcoin climbs to $125,500. Crypto analyst MLM noted that the same trader reportedly shorted additional amounts of Bitcoin and Ethereum minutes before the weekend crash, potentially triggering the liquidation cascade that followed. The timing of these trades relative to major market-moving events has raised serious questions about market fairness and transparency.

This mysterious trader’s history dates back to Bitcoin’s earliest years in 2011, when the address accumulated 86,000 Bitcoin during the cryptocurrency’s formative period. Recent on-chain records show the trader executed a massive portfolio reallocation, selling 35,991 Bitcoin worth $4.43 billion starting in August to purchase 886,371 Ethereum valued at $4.07 billion. Despite these substantial sales, the wallet still holds 49,634 Bitcoin worth approximately $5.43 billion distributed across four addresses, establishing the entity as one of crypto’s most significant and influential whales.

The tariff announcement triggered catastrophic market conditions, with over $19 billion in liquidations occurring within 24 hours as Bitcoin dropped 7.5% to $112,505 and Ethereum fell 12.5% to $3,837. Some analysts argue the actual liquidation figure reached $30 billion to $40 billion when accounting for positions not captured in public data. The volatility affected trading platforms across the spectrum, from major centralized exchanges to decentralized platforms and even UK-based Bitcoin casinos that rely on stable crypto prices for their operations.

The liquidation cascade had devastating consequences for many traders, with over 250 wallets losing millionaire status on Hyperliquid alone following the selloff. While most traders suffered significant losses, the whale’s perfectly timed short positions generated massive profits. The market turmoil highlighted the extreme risks of leveraged trading in volatile conditions, with one trader taking a contrasting position by going long $11 million on Bitcoin with 40x leverage, betting on a rebound from the selloff.

The sharp volatility and apparent market manipulation have reignited debates about crypto market integrity and the lack of regulatory oversight in decentralized trading environments. Janis Kluge, a researcher at SWP Berlin, emphasized that crypto participants are confronting the reality of unregulated markets: “insider trading, corruption, crime, and zero accountability.” This sentiment echoes growing concerns about market fairness as large players appear to operate with impunity.

During the market turmoil, Binance faced separate technical issues as multiple traders reported failed stop-loss orders, token depeggings, and sudden liquidations. The exchange initially denied any technical fault, attributing the problems to a display issue, but later announced it would compensate affected users with $283 million for those holding depegged collateral assets including USDE, BNSOL, and WBETH.

The depegging incidents occurred between 21:36 and 22:16 UTC on October 10, with Ethena’s USDe stablecoin—designed to maintain a $1 peg—briefly crashing to $0.66 during peak volatility. Binance confirmed that futures, margin, and loan users who held these assets as collateral during the depeg window qualified for compensation. The exchange distributed payments in two batches within 24 hours of the incident, attempting to restore confidence amid the market chaos.

The market volatility coincided with political developments that saw President Trump’s approval rating drop to 40% according to a recent Reuters poll, with 58% disapproving of his performance. The decline follows growing criticism of his decision to militarize law enforcement and an ongoing government shutdown triggered by Congress’s failure to pass spending bills.

Senator Elizabeth Warren voiced concerns about Trump’s crypto involvement, warning that it could pose ethical risks if he profits from related ventures during his presidency. These political developments, combined with the whale’s suspicious trading activity, highlight the complex intersection between cryptocurrency markets, political events, and regulatory oversight—or lack thereof—in the digital asset space.