Account unrealized profit of $14 million, an aggressive trader switches from taking profit on long positions to shorting PAXG within an hour

On-chain data monitoring platform HyperInsight detected a rapid reversal trading operation. The trader labeled as “20 million wave hunter” closed a long position on the gold token PAXG and, within just 1 hour, switched to a short position. Currently, the account’s unrealized profit has reached $14 million. This agile trading style reflects the precise market timing of aggressive traders and also exposes the risks and opportunities in high-leverage derivatives markets.

Trading Logic Behind the Rapid Reversal

Small profit-taking on long positions

On January 23, within the past hour, this trader closed a long position on PAXG, with a holding period of 29 hours, realizing a profit of $13,800. The profit may seem modest, but the key point is the speed and rhythm of the trade—taking profit in less than 30 hours indicates a typical short-term trading approach.

Immediate decision to short in the opposite direction

Right after closing the position, the trader switched to a short position, currently short 25.929 PAXG with 5x leverage, with an average entry price of $4,968.67. The current PAXG price is $4,954.62, meaning this short position is already in profit. This quick reversal indicates the trader’s short-term outlook on the gold market has shifted.

Account performance reveals underlying issues

More notably, the trader’s historical performance shows that this address has accumulated a total profit of $110.8 million over its entire cycle, indicating an aggressive trading style that leverages high leverage for short-term gains. The $14 million unrealized profit accounts for about 12.6% of their total historical profits, suggesting the current position size is quite significant.

Context of Gold Market Enthusiasm

Market with crowded long positions

According to related news, the gold market is currently crowded with long positions. A whale labeled as “the largest on-chain gold long” closed a PAXG long position in the past few hours, realizing a profit of $330,000. Meanwhile, another whale holding a large long position in precious metals has an unrealized profit of over $470,000. These indicate that the gold market continues to rise, with longs taking profits.

Explosive growth in the PAXG market

PAXG (PAX Gold) is a tokenized gold issued by Paxos Trust, with each token pegged to 1 troy ounce of physical gold. Latest data shows PAXG’s market cap has surpassed $1.8 billion, with a circulating supply of 380,800 tokens and a 24-hour trading volume of $189 million. Since early 2026, PAXG has grown by 360%, far outpacing mainstream cryptocurrencies.

Exchange-driven momentum

Huobi HTX launched perpetual contracts for PAXG, XAUT, and XAG on January 22, with up to 20x leverage, and simultaneously initiated the “Gold and Silver New High Sprint” event with a prize pool of $88,888. This demonstrates that the tokenization of gold has attracted participation from major exchanges.

Market Significance of the Reversal

From crowded longs to a reversal operation

When many large traders are long on gold and their profits are substantial, this aggressive trader chooses to short instead. This may reflect two possibilities: one, that they believe gold’s short-term rally is overdone and a correction is imminent; or two, that they are seeking contrarian gains in a crowded long market.

Personal opinion: Such reversal actions are common in high-leverage markets and often serve as a hedge against overly optimistic market sentiment. Gold rising from $4,890 to the current $4,954.62 has already seen significant gains, and profit-taking or shorting in the short term is a normal market behavior.

Risks of high leverage trading

While this trader’s unrealized profit is impressive, the risks behind it should not be overlooked. Shorting 25.929 PAXG with 5x leverage means that if gold continues to rise, the unrealized loss on this position will quickly increase. Although the account has a total profit of $110.8 million, a single mistake in a high-leverage environment could lead to substantial losses.

Summary

The rapid reversal operation by this “20 million wave hunter” reflects the characteristics of aggressive traders in the crypto derivatives market: sharp market intuition, quick decision execution, and full utilization of leverage tools. The $14 million unrealized profit looks impressive but also highlights the risk attributes of such high-leverage strategies.

Currently, the gold market is in a crowded long position with considerable gains. The emergence of reversal operations is a sign of market self-regulation. For ordinary investors, observing but not necessarily following such whale actions is advisable, as high-leverage markets often entail proportionate risks.