Decentralized finance Big investor Witnesses $106 Million In ETH Liquidated On Sky Amidst Crypto market Collapse

A prominent Ether investor has experienced a shocking wrecked of $106 million after facing liquidation on the decentralized finance (Decentralized finance) lending platform Sky, triggered by a sharp decline in ETH (ETH) prices on April 6.

As per information from the Maker Vaults explorer DeFi Explore and blockchain analytics network Lookonchain, the trader, often labeled as a “whale” due to the magnitude of the position, had 67,570 ETH liquidated following a nearly 14% drop in the asset’s value.

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Ethereum Price Decline Forces Whale’s Collateral Under Threshold, Resulting in $106M Liquidation

The liquidation occurred on Sky, which was previously known as MakerDAO, rebranding in August 2023. Sky facilitates users in borrowing its stablecoin, DAI, by using crypto assets such as ETH as collateral.

To maintain stability, the platform stipulates an overcollateralization ratio—typically 150% or higher—meaning that to borrow 100 DAI, a user must lock at least $150 worth of Ethereum. If the collateral ratio slides below the stipulated threshold, liquidation is automatically initiated by the system.

In this whale’s scenario, the collateral ratio dipped to 144% amidst the ETH sell-off, prompting the liquidation process. The platform seized the Ethereum and started an auction to recover the borrowed DAI, including associated fees. Any leftover collateral is returned to the user after the debt is settled.

Another substantial position might also be in jeopardy. The on-chain data provider Spot On Chain reported that a different large holder with nearly 57,000 wrapped Ethereum (valued at approximately $91 million) was nearing liquidation.

A whale who supplied 56,995 $WETH ($90.8M) to borrow $DAI on #Maker is on the verge of liquidation, with a liquidation price of $1,564.58.

Earlier today, another giant big investor was already liquidated for 67,569 $ETH ($106M) at $1,650 to repay a $74.49M loan as the price plunged!… pic.twitter.com/1GGSJjmmRI

— Spot On Chain (@spotonchain) April 7, 2025

The broader crypto market dump was triggered by U.S. President Donald Trump’s update of extensive tariffs, which unsettled investors across various asset classes.

ETH dropped 14.5% in the last 24 hours, trading at $1,547 at the time of this writing—its lowest level since October 2023, when the trading market was still recovering from the aftermath of the FTX collapse.

ETH is presently down 68% compared to its all-time peak in 2021. Ongoing price declines could put more Decentralized finance borrowers at risk of liquidation unless they increase their collateral.

According to CoinGlass, almost 320,000 traders faced liquidation in the past 24 hours, resulting in losses exceeding $1 billion. Most of these liquidations were associated with BTC and ETH positions.

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Crypto Markets Decline As Tariff Shock Induces Extreme Trader Fear

Crypto asset values dropped sharply on April 6 as U.S. stock futures fell dramatically following the Trump administration’s tariff update.

All nations faced a 10% baseline tariff, with China, the EU, and Japan incurring even higher rates. BTC fell over 6%, while Ether declined by more than 12%, pulling the overall market cap down by 8% to $2.5 trillion.

While prices began to recover modestly—Bitcoin rising to $78,500 and Ether to $1,594—market sentiment remained bleak. The Crypto Fear & Greed Index recorded a score of 23 on April 7, indicating “extreme fear” as investors prepare for further volatility.

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