In the past 48 hours, crypto veteran Jack Yi and his firm Liquid Capital (formerly LD Capital) have become the focus of attention at the center of the Ethereum crash. According to on-chain data, the address associated with Yi, "Trend Research," dumped 155,000 ETH, worth approximately $350 million, into the market in just two days. Holdings plummeted from 618,000 ETH to 463,000 ETH, with the liquidation price dropping to around $1,620.
Why sell? Because DeFi is ruthless. Yi Lihua has huge debts on lending protocols like Aave. When ETH falls below the psychological level of $1,800, or approaches his liquidation line (around $1,685 to $1,855), the smart contract will directly initiate the liquidation process.
If hundreds of millions of dollars in automated liquidations were to occur on-chain, slippage would crash prices, triggering a "death spiral" of cascading liquidations. Yi Lihua was well aware of this, so he had to act before the protocol could. He withdrew his ETH and transferred it to centralized exchanges like Binance to cash out, then transferred back approximately $266 million worth of stablecoins (USDT/USDC) to repay his debts.
The person under the most online pressure
Yi Lihua is no newbie to the crypto market. He's been mining and accumulating cryptocurrency since 2015; he's the kind of person who's witnessed Bitcoin's price rise from three figures to six figures. But this time, even he has to admit defeat. Yi Lihua's post on X today seems unusually honest.
The reason I'm always bullish in this industry is related to my past entrepreneurial experience. Back then, I couldn't find a job, so I started my own business. After earning my first pot of gold, I didn't dare to spend it all but instead invested in tech projects, which I think yielded pretty good results. In 2015, I entered the crypto, mining BTC, buying ETH, and investing in projects. I caught that golden age, and that's the reward for consistently long.
However, the subsequent bear market resulted in significant investment losses, and the inability to withstand the downturn led to premature liquidation of BTC, ultimately causing the company to miss the major bull market following the March 12th crash. This was the consequence of being bearish. Having experienced two bull markets following bear markets, we were more confident in our ability to buy the dips at the bottom this time after successfully exiting the market peak. Therefore, we decided to continue waiting while controlling the risks.
He reflected on the core mistake of this operation: "buy the dips too early" when Bitcoin was at $100,000 and Ethereum at $3,000. He thought he could accurately buy at the bottom, but ended up catching a falling knife halfway down the mountain. He mentioned that he missed the March 12th bull market, and that fear of miss the pump may have influenced his decision-making logic this time.
It's worth noting, however, that even after incurring losses of approximately $136 million, he hasn't liquidated all his positions. Although Yi Lihua sold 150,000 ETH, he still holds 460,000 ETH.
