A Bitcoin whale recently closed a massive short position worth $516 million, securing a profit of $9.4 million in just eight days. The short position, using 40x leverage, involved 6,210 BTC. This move came just ahead of the Federal Open Market Committee (FOMC) meeting scheduled for March 19, 2025, which is expected to provide further direction on U.S. monetary policy and potentially impact investor sentiment towards Bitcoin and other risk assets.
The whale initially opened the short position when Bitcoin’s price was at $84,043, betting on its decline. The position was set to face liquidation if the price rose above $85,592. Despite a group of traders targeting the whale’s position and pushing it to the brink of liquidation, the whale added $5 million to defend it. Ultimately, Bitcoin's price fell, allowing the whale to close the position profitably with a $9.46 million gain.
Following the profit-taking, the whale moved to accumulate Ethereum, purchasing over 3,200 ETH for more than $6.1 million. This purchase was recorded on March 18, 2025, shortly before the FOMC meeting.
This move coincided with the release of the U.S. Consumer Price Index (CPI) for February, which showed a lower-than-expected 2.8% year-over-year increase, compared to the expected 2.9%. This easing of inflation concerns was seen by analysts as a sign that inflationary pressures might be cooling, potentially influencing the Federal Reserve’s stance on interest rates in the coming months.
Fumihiro Arasawa, CEO of xWIN Research, noted that the lower CPI reading could have a positive impact on Bitcoin. He stated that easing inflation could signal a shift in the Federal Reserve’s monetary policy, which may favor Bitcoin’s price movement. Bitcoin’s short-term price action will depend on whether it can hold the $81,000 support level, with a sustained hold potentially stabilizing market sentiment.
Currently, markets are pricing in a 99% chance that the Federal Reserve will keep interest rates steady, according to CME Group’s FedWatch tool. However, any unexpected hawkish signals from the Fed could pressure Bitcoin and other risk assets. Ryan Lee, Chief Analyst at Bitget Research, warned that shifts in the Fed’s stance could influence the price of Bitcoin in either direction.
The Bitcoin whale’s successful trade and the broader market conditions surrounding inflation and the FOMC meeting show how intertwined cryptocurrency markets are with traditional financial developments. How Bitcoin behaves in the coming weeks will depend largely on external factors like inflation data and monetary policy decisions.
