First of all, I personally believe that the likelihood of this article being wrong is very high. If I had to put a number on it, I would say there is a 95% chance it is wrong. However, the world is diverse, and the 5% possibility is still worth assuming.
In the past few days, two lending vaults on MakerDao have been frequently appearing on X, both collateralizing over 60,000 ETH and borrowing more than 60 million Dai, with safety factors struggling on the edge of around 1.0. These two guys are quite stubborn; their safety factors are at 1.02, and they don't even consider liquidating to protect themselves. If a liquidation occurs, it would involve 130,000 ETH, which is over 200 million dollars in sell-off volume.
Everyone wants to see these two big fireworks explode.
I have been observing for a few days, and I feel that these two addresses, at least this one 0x6bb8bc41e668b7c8ef3850486c9455b5c86830b3, are actively adjusting their positions. It is possible that they are engaging in a kind of risky arbitrage.
I might be overthinking it, and if I'm wrong, let's just consider it a hypothetical financial game for everyone.
Since DeFi became popular, the transparency of on-chain assets has made opening large leverage positions on the chain a widely accepted game. There is a psychological effect in the crypto community that tends to favor the explosion of these massive leveraged positions on-chain, commonly referred to as watching big fireworks.
The most classic event was the short selling liquidation of Link in August 2020. An institution called Zeus Capital published a 59-page short report on ChainLink in July 2020, claiming that the intrinsic value of Link was only $0.07, while the price of Link was around $8 at that time. Then, in August, the institution shorted Link by collateralizing a total of 22 million USDC to borrow and sell Link.
As a result, the entire crypto market managed to push LINK from $8 to $13, causing this huge leverage to be liquidated.
Another famous case is the liquidation of Curve's boss's over $140 million in crv collateralized borrowing in mid-2023, which was the largest leverage amount seen on the entire network, forcibly driving the price of crv down to a liquidation price of $0.4, causing a collapse of Curve.
The 50x leverage brother on Hyperliquid from two weeks ago was also a widely enjoyed big firework.
Another non-crypto example is the story of the GameStop battle against Wall Street institutions in January 2021, where retail investors teamed up to drive up the stocks that institutions were shorting, ultimately causing the institutions to get wrecked.
This type of retail investor (more likely that there are anonymous big players in the class) conspiring to buy or sell in the opposite direction of the massive on-chain leverage without the need for communication seems particularly popular in the crypto space; it is a kind of collective emergence phenomenon.
In MakerDao, when opening a vault to collateralize ETH and borrow Dai, the liquidation price will be released one hour in advance. This is different from Aave, which calculates the liquidation price based on blocks.
The image below shows the latest liquidation price of 1795.8 for ETH as collateral announced by MakerDAO just now, while the real-time price of ETH at that time was 1811.45.
If this collateral loan is on Aave, then the liquidation price of 1795.8 should have already been liquidated, but on MakerDAO it has not been liquidated yet and will only be executed after one hour.
In this hour, it provided MakerDao's borrowers with a buffer time, allowing them to actively reduce their positions before the liquidation price is updated, raising their liquidation price to above 1795.8, thereby avoiding liquidation.
Alright, the above are two premise pieces of information, to summarize:
There is a kind of group psychological effect in the cryptocurrency market, where retail investors (anonymous large holders) like to conspire to pump (or dump) massive on-chain leveraged positions;
The liquidation price of MakerDao is updated with a one-hour delay, and the real-time settlement price is actually the price of ETH from the previous hour.
(Once again, I want to emphasize that I personally believe there is a 95% chance that the following speculation is wrong, so please be harsh when critiquing it. This article was written a few days ago, but I didn't publish it because I found it unreliable.)
These two MakerDao 60,000 brothers may be taking advantage of the above two characteristics to complete a massive influx of funds or engaging in a risky arbitrage.
Suppose a guy with 60,000 is preparing a huge amount of funds and wants to invest in the broken Ethereum that everyone is cursing and attacking. However, this guy's funds are too large, and going in directly might result in slippage of over 10%. His expected price is below 1800.
How large does the amount of funds need to be?
Think about MicroStrategy, which invested over 35 billion USD, with an average acquisition cost of 67,000 USD per BTC, accumulating 520,000 Bitcoins. The market capitalization of Bitcoin is approximately 2 trillion USD. MicroStrategy's holding percentage has reached a single-digit % (based on a total supply of 21 million, it's 2.5%, considering that over 3 million coins were lost early, based on a total supply of 18 million, it's about 2.9%).
MicroStrategy first purchased 21,400 Bitcoins in August 2020 for $250 million, with an average acquisition cost of over $11,000. As of now, in April 2025, this guy has accumulated 520,000 coins, raising the cost price to $67,000.
Correspondingly, if Brother 6w wants to invest an amount that reaches a single-digit percentage of Ethereum's market value, for example, 2% = 2.5 billion USD level, if he wants to control the cost of building the position, he cannot be as high-profile as MicroStrategy Brother.
Brother 6w, just take advantage of the collective effect of the cryptocurrency community that wants to explode with leveraged positions, publicly set up a large long position of 60,000 Ether (100 million USD), and stimulate cryptocurrency users to sell off, while Brother 6w buys coins at a low price.
At the same time, in order to avoid the liquidation of these 60,000 Ether, 60,000 brothers need to always be ready with enough Dai to reduce leverage and avoid liquidation. This continues until all positions are fully established.
In fact, thinking back to the big fireworks of Chainlink on Aave four years ago, as well as the nearly $200 million super liquidation by the Crv boss, it might just be a form of selling coins.
It’s possible (with a probability of less than 5%) that this time a super large holder wants to sell LINK. To avoid a large sell-off, they open a $20 million short leverage, stimulating a collusion in the crypto circle to pump the price and then take the opportunity to sell near the liquidation price. Spending a few million on liquidation costs to sell billions worth of tokens is too cost-effective.
And the boss of CRV this time, is simply trying to get rid of the huge amount of coins in his hands, and if he really smashes it in the market, he may have to go directly to zero, and he can't spend much money, but by establishing long leverage, mortgage CRV will lend out U to cash out, as for the collateral, let the market explode.
Another lower possibility is that these two 60,000 in MakerDao might be playing the following arbitrage logic:
16,000 users are using MakerDao to collateralize massive amounts of ETH to open large leveraged positions to borrow Dai, triggering a short-selling effect on ETH among retail investors in the industry.
The 26,000 brothers will buy ETH below their MakerDao vault's liquidation price (1800), for example, at 1750.
If, after the MakerDao liquidation price update, your position will be liquidated, then 6w will repay part of the debt in advance to avoid liquidation, or increase the amount of ETH purchased in the above 2, to raise the collateral amount, thereby increasing the risk of liquidation.
If the real-time price rises above 1800 before MakerDao updates the liquidation price, then the ETH bought by 6w哥 in step 2 is profitable. 6w哥 can sell the ETH, for example, at 1850 to make a profit.
Just like that, it kept going back and forth until the price completely dropped to the point where all of 6w Ge's principal was converted into Ethereum, thus completing a significant investment below 1800; or it could keep rising until there were no more Ethereum to sell, which would mean successful arbitrage, and then exit, waiting for the next opportunity at 1800.
Welcome financial experts and mathematics experts to provide corrections.
In fact, entering the cryptocurrency market with large funds has always been a challenge; the difficulty of depositing is a barrier, and another barrier is that the total pool is too small. Ten years ago, if you wanted to buy a large amount of Bitcoin, the strategy was to choose to buy mining machines for mining.
The content is for reference only, not a solicitation or offer. No investment, tax, or legal advice provided. See Disclaimer for more risks disclosure.
MakerDao's double 60,000 brothers who are close to the liquidation price many times may be thrilling arbitrage
Source: Lightning HSL
First of all, I personally believe that the likelihood of this article being wrong is very high. If I had to put a number on it, I would say there is a 95% chance it is wrong. However, the world is diverse, and the 5% possibility is still worth assuming.
In the past few days, two lending vaults on MakerDao have been frequently appearing on X, both collateralizing over 60,000 ETH and borrowing more than 60 million Dai, with safety factors struggling on the edge of around 1.0. These two guys are quite stubborn; their safety factors are at 1.02, and they don't even consider liquidating to protect themselves. If a liquidation occurs, it would involve 130,000 ETH, which is over 200 million dollars in sell-off volume.
Everyone wants to see these two big fireworks explode.
I have been observing for a few days, and I feel that these two addresses, at least this one 0x6bb8bc41e668b7c8ef3850486c9455b5c86830b3, are actively adjusting their positions. It is possible that they are engaging in a kind of risky arbitrage.
I might be overthinking it, and if I'm wrong, let's just consider it a hypothetical financial game for everyone.
Since DeFi became popular, the transparency of on-chain assets has made opening large leverage positions on the chain a widely accepted game. There is a psychological effect in the crypto community that tends to favor the explosion of these massive leveraged positions on-chain, commonly referred to as watching big fireworks.
The most classic event was the short selling liquidation of Link in August 2020. An institution called Zeus Capital published a 59-page short report on ChainLink in July 2020, claiming that the intrinsic value of Link was only $0.07, while the price of Link was around $8 at that time. Then, in August, the institution shorted Link by collateralizing a total of 22 million USDC to borrow and sell Link.
As a result, the entire crypto market managed to push LINK from $8 to $13, causing this huge leverage to be liquidated.
Another famous case is the liquidation of Curve's boss's over $140 million in crv collateralized borrowing in mid-2023, which was the largest leverage amount seen on the entire network, forcibly driving the price of crv down to a liquidation price of $0.4, causing a collapse of Curve.
The 50x leverage brother on Hyperliquid from two weeks ago was also a widely enjoyed big firework.
Another non-crypto example is the story of the GameStop battle against Wall Street institutions in January 2021, where retail investors teamed up to drive up the stocks that institutions were shorting, ultimately causing the institutions to get wrecked.
This type of retail investor (more likely that there are anonymous big players in the class) conspiring to buy or sell in the opposite direction of the massive on-chain leverage without the need for communication seems particularly popular in the crypto space; it is a kind of collective emergence phenomenon.
In MakerDao, when opening a vault to collateralize ETH and borrow Dai, the liquidation price will be released one hour in advance. This is different from Aave, which calculates the liquidation price based on blocks.
The image below shows the latest liquidation price of 1795.8 for ETH as collateral announced by MakerDAO just now, while the real-time price of ETH at that time was 1811.45.
If this collateral loan is on Aave, then the liquidation price of 1795.8 should have already been liquidated, but on MakerDAO it has not been liquidated yet and will only be executed after one hour.
In this hour, it provided MakerDao's borrowers with a buffer time, allowing them to actively reduce their positions before the liquidation price is updated, raising their liquidation price to above 1795.8, thereby avoiding liquidation.
Alright, the above are two premise pieces of information, to summarize:
There is a kind of group psychological effect in the cryptocurrency market, where retail investors (anonymous large holders) like to conspire to pump (or dump) massive on-chain leveraged positions;
The liquidation price of MakerDao is updated with a one-hour delay, and the real-time settlement price is actually the price of ETH from the previous hour.
(Once again, I want to emphasize that I personally believe there is a 95% chance that the following speculation is wrong, so please be harsh when critiquing it. This article was written a few days ago, but I didn't publish it because I found it unreliable.)
These two MakerDao 60,000 brothers may be taking advantage of the above two characteristics to complete a massive influx of funds or engaging in a risky arbitrage.
Suppose a guy with 60,000 is preparing a huge amount of funds and wants to invest in the broken Ethereum that everyone is cursing and attacking. However, this guy's funds are too large, and going in directly might result in slippage of over 10%. His expected price is below 1800.
How large does the amount of funds need to be?
Think about MicroStrategy, which invested over 35 billion USD, with an average acquisition cost of 67,000 USD per BTC, accumulating 520,000 Bitcoins. The market capitalization of Bitcoin is approximately 2 trillion USD. MicroStrategy's holding percentage has reached a single-digit % (based on a total supply of 21 million, it's 2.5%, considering that over 3 million coins were lost early, based on a total supply of 18 million, it's about 2.9%).
MicroStrategy first purchased 21,400 Bitcoins in August 2020 for $250 million, with an average acquisition cost of over $11,000. As of now, in April 2025, this guy has accumulated 520,000 coins, raising the cost price to $67,000.
Correspondingly, if Brother 6w wants to invest an amount that reaches a single-digit percentage of Ethereum's market value, for example, 2% = 2.5 billion USD level, if he wants to control the cost of building the position, he cannot be as high-profile as MicroStrategy Brother.
Brother 6w, just take advantage of the collective effect of the cryptocurrency community that wants to explode with leveraged positions, publicly set up a large long position of 60,000 Ether (100 million USD), and stimulate cryptocurrency users to sell off, while Brother 6w buys coins at a low price.
At the same time, in order to avoid the liquidation of these 60,000 Ether, 60,000 brothers need to always be ready with enough Dai to reduce leverage and avoid liquidation. This continues until all positions are fully established.
In fact, thinking back to the big fireworks of Chainlink on Aave four years ago, as well as the nearly $200 million super liquidation by the Crv boss, it might just be a form of selling coins.
It’s possible (with a probability of less than 5%) that this time a super large holder wants to sell LINK. To avoid a large sell-off, they open a $20 million short leverage, stimulating a collusion in the crypto circle to pump the price and then take the opportunity to sell near the liquidation price. Spending a few million on liquidation costs to sell billions worth of tokens is too cost-effective.
And the boss of CRV this time, is simply trying to get rid of the huge amount of coins in his hands, and if he really smashes it in the market, he may have to go directly to zero, and he can't spend much money, but by establishing long leverage, mortgage CRV will lend out U to cash out, as for the collateral, let the market explode.
Another lower possibility is that these two 60,000 in MakerDao might be playing the following arbitrage logic:
16,000 users are using MakerDao to collateralize massive amounts of ETH to open large leveraged positions to borrow Dai, triggering a short-selling effect on ETH among retail investors in the industry.
The 26,000 brothers will buy ETH below their MakerDao vault's liquidation price (1800), for example, at 1750.
If, after the MakerDao liquidation price update, your position will be liquidated, then 6w will repay part of the debt in advance to avoid liquidation, or increase the amount of ETH purchased in the above 2, to raise the collateral amount, thereby increasing the risk of liquidation.
If the real-time price rises above 1800 before MakerDao updates the liquidation price, then the ETH bought by 6w哥 in step 2 is profitable. 6w哥 can sell the ETH, for example, at 1850 to make a profit.
Just like that, it kept going back and forth until the price completely dropped to the point where all of 6w Ge's principal was converted into Ethereum, thus completing a significant investment below 1800; or it could keep rising until there were no more Ethereum to sell, which would mean successful arbitrage, and then exit, waiting for the next opportunity at 1800.
Welcome financial experts and mathematics experts to provide corrections.
In fact, entering the cryptocurrency market with large funds has always been a challenge; the difficulty of depositing is a barrier, and another barrier is that the total pool is too small. Ten years ago, if you wanted to buy a large amount of Bitcoin, the strategy was to choose to buy mining machines for mining.