A major investor in Ethereum, often referred to as a “whale”, experienced a staggering $106 million loss after being liquidated on the DeFi lending platform Sky during a significant market downturn on April 6.

According to data from Maker Vaults explorer DeFi Explore and blockchain tracker Lookonchain, the investor saw 67,570 ETH liquidated after the asset’s price slipped by almost 14%.

ETH Price Drop Pushes Whale’s Collateral Below Threshold

The liquidation occurred on Sky, previously known as MakerDAO, which underwent a rebrand in August 2023. The platform allows users to borrow its stablecoin, DAI, by locking crypto assets like ETH as collateral. To maintain stability, a typical borrowing requires an overcollateralization ratio of 150% or more.

In the case of this whale, the collateral ratio fell to 144% during the ETH price drop, triggering the liquidation process. The protocol seized the ETH and began an auction to recover the borrowed DAI, including any fees. Remaining collateral is returned to the user once the debt is settled.

Another significant position is reportedly at risk as an on-chain data platform, Spot On Chain, indicated that another whale, who had provided nearly 57,000 wrapped ETH (valued at approximately $91 million), is close to liquidation.

⚠️ A whale who supplied 56,995 $WETH (around $90.8M) to borrow $DAI on #Maker is on the verge of liquidation with a liquidation price set at $1,564.58. An earlier event resulted in the liquidation of another whale for 67,569 $ETH (valued at $106M) at a price of $1,650 to repay a $74.49M loan as the price dropped!

The broader sell-off in the crypto market was influenced by U.S. President Donald Trump’s announcement of extensive tariffs, which caused widespread concern among investors.

As of the time of writing, ETH fell 14.5% over the previous 24 hours, trading at $1,547—the lowest point since October 2023, a time when the market was still recovering from the FTX collapse. Ethereum has since decreased by 68% from its all-time high in 2021.

The uncertainty could continue to jeopardize many DeFi borrowers unless they bolster their collateral. According to CoinGlass, about 320,000 traders faced liquidations in the last 24 hours, accounting for over $1 billion in losses primarily linked to Bitcoin and Ethereum positions.

Crypto Markets Deteriorate Due to Tariff Announcement

The cryptocurrency market experienced sharp declines on April 6 following a dip in U.S. stock futures, attributed to the Trump administration’s announcement of extensive tariffs. A 10% baseline tariff was imposed across all countries, while China, the EU, and Japan faced even higher rates. Concurrently, Bitcoin plunged over 6%, while Ether declined more than 12%, driving the total crypto market cap down to $2.5 trillion.

Despite a minor recovery in prices, market sentiment remained pessimistic, as evidenced by the Crypto Fear & Greed Index rating 23 on April 7, indicating extreme fear among investors preparing for potential volatility.