The post How James Wynn’s $100M Implosion Is a Leverage Tale as old as Time appeared on BitcoinEthereumNews.com.

Derivatives trader James Wynn emerged out of the woodworks a few weeks ago, flaunting 9-figure bitcoin positions on HyperLiquid as he went on a seemingly undefeatable run that culminated in around $100 million worth of profit. But that run, as is often the case with highly-leveraged crypto derivative trading, came to a shocking end — Wynn liquidated his entire account despite BTC only moving by a couple of percent. “I’ve decided to give perp trading a break,” Wynn wrote on X after the final blow up. “Its been a fun ride. Approximately $4 million into $100 million and then back down to a total account loss of $17.5 million.” Wynn’s story is nothing new. In 2021, for instance, the industry saw the public rise of Alex Wice — a poker player turned derivatives trader — that also lost $100 million after making huge bets with leverage. And even in 2017, in the BitMEX trollbox days, pseudonymous figures like SteveS and TheBoot used to boast about their 10s of millions in profit and loss before forever fading into obscurity. The problem with crypto derivatives Cryptocurrency derivatives can be an incredibly useful tool; if a trader holds 500 BTC ($52 million) and believes the market will go down, they can hedge their position by going short — reducing exposure without having to sell their spot assets, which in itself could cause slippage or front running. An array of delta neutral strategies can also be employed like the classic basis trade that became popular amongst institutional traders on the bitcoin CME futures market, which involve simultaneously going long and short to harvest the funding rate as a yield. But issues begin to form when crypto traders, the majority of whom are inexperienced retail traders, use platforms that offer up to 100x leverage. Imagine…

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Filed under: News - @ June 2, 2025 8:29 pm