A recent example highlights the inherent volatility in the cryptocurrency market. A trader experienced significant financial losses after navigating volatile movements on Ethereum (ETH) and Bitcoin (BTC). On May 19th, they initiated a short position on ETH with a leverage of 25x when the price was $2,514, amassing a total position worth $103 million. As ETH’s value climbed, the trader needed to gradually unwind their position, leading to a loss of $2.46 million. Ironically, after triggering their stop-loss mechanism, ETH’s price dropped. They later opened a long position on Bitcoin (BTC) at a leverage level of 40x, acquiring 166 BTC worth $17.6 million. This position was set to liquidate if the price fell below $105,510. High leverage in this situation posed a significant risk of liquidation even with minor Bitcoin price fluctuations.