Ethereum’s Price Drop Puts $238M in ETH at Risk of Liquidation: Report

• Two large Ethereum whales on Maker risk of liquidation as 125,603 ETH, valued at $238M is at stake.
• Ethereum’s health rate drops to $1.07, putting whales’ positions close to liquidation at $1,805 and $1,787.
• Liquidation of these large ETH positions could spark market volatility, with traders awaiting potential moves.

Ethereum’s (ETH) price trend is currently bearish applied force amounting to issue concerns among two large-figure whales that invested on Maker. Lookonchain, an analytical platform, made this disclosure in its X post, stating that the whales are in a precarious position of being liquidated. Therefore, a total of 125,603 ether, having a value of approximately 238 million USD, is at risk.

Ethereum Price Decline and Health Rate

The ETH price has been decreasing over some time and little for the health rate of the Maker vaults that hold a massive number of ETH. The health rate which measures the rate of health of any position offered has significantly dropped to $1.07. This worrying state of affairs positions the whales’ holding in a rather dire state. The costs include the liquidation prices for these positions in the amount of $1,805 and $1,787 respectively.

This update raised debates in the eyes of the crypto community because the liquidation of such gigantic amount of ETH will likely cause a ripple effect in the market. As the price of Ethereum approaches these liquidations value, traders and investors are eagerly waiting to see if the large players will be able to prevent further liquidations.

Liquidity risk brings focus to the fact that leveraged positions on decentralized finance platforms such as Maker are actually very risky. The actual volatility of Ethereum’s price poses a great threat to such positions, especially when the value drops drastically to the extent that the remaining collateral backing these positions falls below the necessary health rate.

Liquidation Risk and Market Shifts

Indeed, there is always the possibility of the liquidation, which at the moment seems likely, and Ethereum traders are ready for further shifts in the market in light of these recent occurrences. Under the current market conditions, if the price drops further and the liquidation price is reached, this will open up selling opportunities, pushing the ETH price down even further. As of this writing, Ethereum has been trading at $1,873, which is 1.96% lower in the last 24 hours.

Source: TradingView

While Ethereum still oscillates in the bearish region, the outcome of these two whales positions on Maker is a clear indication the dangers of leveraged trading and the impact that such big holders can trigger in the crypto domain. The following days will be critical in whether to hold higher highs above the liquidation or experience more significant market volatility.