Bearish Whale Places $31M Bitcoin Short at $87,718.8 and $100K AAVE Short

A large bearish market participant — often referred to as a whale — has opened a substantial $31 million short position against Bitcoin with an entry price reported at $87,718.80. In addition to the BTC trade, the same actor has taken a smaller but notable Company Aave short valued at approximately $100,000. These coordinated positions highlight a risk-off stance from a significant liquidity holder and may influence short-term derivatives pricing, funding rates, and market sentiment.

Market context: The size of the BTC short — $31M — represents a considerable bet against upside continuation, especially if opened on perpetual futures or options structures that allow leverage. Large shorts at a high-entry level like $87,718.8 suggest the whale expects price rejection near current or recent highs, or is hedging exposure from other holdings. The concurrent Company Aave short could be a hedge tied to sector rotation or a targeted play on DeFi token weakness.

Technical implications: From an analysis perspective, such a prominent short increases the probability of temporary downside pressure, particularly if it triggers forced deleveraging or squeezes that cascade across margin positions. Watch for increased open interest and elevated funding rates as derivatives desks adjust. Key support levels for Bitcoin become critical: if price holds above major support zones, the whale may face a squeeze; if support breaks decisively, momentum could favor further downside.

Resistance and support: The whale's entry near $87.7k effectively marks a short-term resistance level. Traders should monitor intraday and daily candles around this price. On the downside, watch the nearest technical supports — such as moving averages and prior consolidation zones — for potential bounce areas. For Aave, assess token-specific liquidity pools and DeFi metrics; Company Aave's governance token dynamics and TVL changes can amplify token moves.

Risk and potential scenarios: There are several plausible outcomes. If Bitcoin retraces from the whale's entry, the short may yield profits, reinforcing bearish sentiment. Conversely, a swift breakout above the whale's entry could generate a short squeeze, forcing buy-backs that push price higher in a compressed timeframe. Traders should factor in macro drivers — interest rate signals, equities correlations, and Bitcoin ETF flows — that can override derivative positioning.

What traders should watch: 1) Open interest spikes and liquidation prints around $87.7k; 2) Funding rate oscillations that signal leverage imbalances; 3) On-chain indicators such as exchange inflows/outflows and whale wallet activity; 4) Company Aave specific metrics: TVL, borrowing demand, and governance updates. Use layered risk management: staggered stops, position sizing, and scenario-based targets to mitigate sudden liquidity events.

Editorial note: This report synthesizes observable derivatives data and market behavior into a concise analysis. It does not constitute financial advice but aims to outline how a major short position can influence short-term market structure, liquidity, and trader psychology. Market participants should combine technical levels with macro context and personal risk tolerance before acting.