The cryptocurrency market has experienced significant turbulence recently, with the movements of prominent "whale" investor Yi Lihua and his firm, Trend Research, drawing intense scrutiny. According to the latest on-chain data monitoring, the institution has completed a total liquidation of its Ethereum (ETH) holdings, marking a conclusion to this round of large-scale leveraged positioning with a staggering loss. For the average cryptocurrency user, this serves not only as a signal of institutional withdrawal but also as a critical case study in risk management and market cycle timing.
Key Takeaways
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Liquidation Scale: Trend Research offloaded approximately 658,000 ETH over an 8-day period, achieving a complete exit.
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Financial Impact: The operation resulted in a realized book loss of approximately $688 million, wiping out most profits accumulated during the previous bull cycle.
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Core Data: The average entry cost was approximately $3,104, while the average selling price hovered around $2,058.
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Market Signal: This move primarily involved stopping losses on high-leverage positions, reflecting the intense deleveraging pressure faced by institutions during extreme market downturns.
Analysis of Institutional ETH Holding Changes
Based on monitoring from Arkham and various on-chain analysts, the liquidation process for Trend Research spanned roughly a week. In a recent final move, the institution transferred the last remaining hundreds of ETH from its addresses to Binance, signaling the definitive end of its current holding cycle.
Data tracking reveals that Trend Research adopted a highly aggressive allocation strategy during this market phase. The firm accumulated massive amounts of tokens at prices above $3,100 and utilized lending protocols like Aave to significantly leverage its position. However, as Ethereum prices experienced a sharp correction in early 2026, many of these borrowed positions hit liquidation warning zones, forcing the institution to sell into a declining market to mitigate further risk.
Loss Magnitude and Profit Reversal
The financial fallout of this liquidation has sent shockwaves through the industry. Statistics indicate that this specific trading round resulted in a loss of roughly $688 million. When factored against the firm's recorded gains of approximately $315 million between 2024 and 2025, this wave of selling didn't just erase previous earnings—it left the firm with a net deficit of about $373 million.
Why Choose a Total Exit Now?
For many cryptocurrency holders, seeing a major player "sell the bottom" can be confusing. However, from the perspective of liquidity and risk management, such a move is often a forced necessity.
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The Domino Effect of Leveraged Liquidation
Trend Research’s holdings were heavily comprised of leveraged debt positions. As ETH prices slipped below $2,300 and moved toward $1,800, the pressure to maintain collateral ratios became immense. To avoid being forcibly liquidated by protocols—which carries additional penalties and triggers market slippage—institutions often choose to proactively reduce positions to repay debts and lower their leverage ratio.
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Opportunity Cost and Capital Efficiency
When asset prices enter a prolonged period of decline or stagnation, maintaining leveraged positions incurs high borrowing costs (interest). For Trend Research, with entry costs at such high levels, continuing to hold meant not only the risk of further principal erosion but also a heavy burden on capital efficiency. A clean exit was likely a strategic choice to preserve what remained of their liquidity.
Outlook Following Market Deleveraging
While the departure of a "whale" often accompanies market instability, it frequently signals a concentrated release of risk.
Reshaping Market Sentiment
Massive institutional sell-offs are often viewed as the "capitulation" phase or the peak of market panic. Following the completion of Trend Research's liquidation, on-chain transaction volume for Ethereum briefly hit record highs. This suggests that as the institution stopped its losses, ownership was transferred from high-leverage whales to other buyers.
Ethereum’s Performance in a Macro Context
Entering 2026, Ethereum faces multifaceted challenges, ranging from increased competition among Layer 2 ecosystems to tightening liquidity in the broader macro-economic environment. In subsequent public comments, Yi Lihua noted that market cycles remain valid, and while setbacks are inevitable in the short term, he remains attentive to the industry's long-term development. This shift from aggressive expansion to defensive observation reflects the prevailing sentiment among mainstream institutional players today.
Conclusion
The liquidation event of Yi Lihua’s Trend Research provides a profound lesson in risk for the cryptocurrency industry. The pursuit of high returns can lead to massive financial gaps if leverage and market cycles are mismatched. For cryptocurrency users, while it is important to track whale movements, it is even more vital to prioritize personal portfolio risk control.
FAQs
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What was the total loss for Trend Research in this liquidation?
According to on-chain monitoring, Trend Research realized a total loss of approximately $688 million in this round. When accounting for previous profits, the net loss stands at approximately $373 million.
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Why did Yi Lihua choose to sell at a loss rather than continue holding?
The primary reason was the risk of liquidation on high-leverage positions. As ETH prices dropped, failing to take proactive stop-loss measures could have resulted in the total forfeiture of assets on lending platforms. High interest rates on borrowed funds also contributed to the decision to exit.
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What was the average selling price of the ETH?
Statistics show the average selling price was approximately $2,058, compared to an average buy-in cost of roughly $3,104.
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How do large-scale institutional liquidations affect Ethereum's price?
In the short term, they create immense selling pressure, which can lead to rapid price drops or trigger panic selling. However, in the long run, this is part of the market’s deleveraging process, helping to clear out excessive speculative bubbles.
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Does Trend Research still hold any ETH?
Latest on-chain address data suggests the institution has essentially completed its liquidation, with only negligible amounts of "dust" ETH remaining in its primary active addresses.