The crypto industry is known for its volatility and risky trading, which can turn sour if not managed properly, even for very experienced crypto traders. One such loss is the case of crypto millionaire James Fickel, who lost his bold bet on Ethereum confronted him with staggering losses.
Data shows that Fickel has lost a significant amount of money since January 10, over $43 million. Furthermore, Fickel has seen his debt on his Ethereum transaction rise to $132 million.
The Bet: A Bold Move on Ethereum
Fickel’s problems began in January when he made a very risky bet that Ethereum Would Surpass Bitcoin in 2024. To execute this strategy and profit from it, he took a massive loan of $172 million worth of Wrapped Bitcoin (WBTC) from Aave, a decentralized crypto lending platform. With this loan, Fickel bought a total of 56,445 ETH at a rate of 0.05424 BTC per ETH, betting that Ethereum would increase in value against Bitcoin.
Unfortunately for Fickel, 2024 has not been a good year for Ethereum compared to Bitcoin. BTC has had a great year since the launch of Spot Bitcoin ETFs in the United States. Although Spot Ethereum ETFs also found their way to in the US market they are struggling to keep pace with Bitcoin ETFs in terms of inflow.
According to data from Tradingview, the ETH/BTC pair has fallen by over 34% since January 11, with analysis pointing to further declines. This slowdown in Ethereum’s price growth began to reduce Fickel’s position as the value of his ETH holdings began to dwindle.
On August 7, it became clear to Fickel that the strategy was unlikely to pay off. Since then, he has spent $12 million in USDC to buy 211 WBTC and traded another 16,000 ETH for another 671 WBTC to pay off some of his debt on Aave.
At this time, Fickel still owes Aave 2,196 WBTC, which equates to a debt of approximately $132 million. According to on-chain data from LookonchainJames Fickel has lost approximately 18,000 ETH since the beginning of the year, worth $43.7 million.
Rise to crypto prominence
James Fickel is one of the largest individual holders of Ethereum with a net worth of over $400 million. His rise to crypto prominence came during the early days of Ethereum, when he reportedly purchased $400,000 worth of ETH for just $0.80 per coin, a move that laid the foundation for his considerable wealth.
At the time of writing, Ethereum is trading at $2,415 while Bitcoin is trading at $60,100. Despite both cryptocurrencies posting gains over the past week, Bitcoin continues to outperform Ethereum up 10.2% compared to Ethereum’s 5.1% increase.
Main image from Pexels, chart from TradingView