ZEC short on Hyperliquid nets Garrett Jin $13.5M as BitForex fraud fallout continues
Garrett Jin, founder of the now-defunct and fraud-accused exchange BitForex, has accumulated about $13.5 million in unrealized profit from a leveraged ZEC short on Hyperliquid, according to Onchain Lens.
The trade: Jin opened a 3x leveraged ZEC short on the decentralized exchange Hyperliquid (HYPE). The position’s timing aligns with a price drop after a bug was discovered in Zcash’s Orchard Pool privacy protocol, raising concerns over network security and user privacy. As of the latest data, the ZEC short is up roughly $13.5 million on an unrealized basis.
Counter-move: Jin also holds a 5x leveraged long position on Bitcoin (BTC). That BTC long is currently underwater, with unrealized losses exceeding $17 million.
Broader context: BitForex collapsed in 2024 amid allegations of fraudulent activity and misappropriation of user funds. Regulators in Hong Kong and Japan reportedly warned and initiated investigations. Withdrawals were frozen in early 2024, leaving many users unable to access assets.
Trading relevance for crypto traders: This highlights how the ZEC short benefited directly from a catalyst-driven drawdown tied to privacy-technology risk, while the BTC leveraged long shows leverage can quickly flip winners into losers. It also reinforces the market impact of exchange failures and the growing ability of on-chain analytics to track trading behavior even when activity occurs on DEX venues like Hyperliquid.
Bottom line: The ZEC short profit is unrealized and could change rapidly with volatility, but the sequence—privacy-protocol bug → ZEC selloff → profitable leveraged positioning—offers a concrete example of catalyst sensitivity in derivatives markets.
Bearish
This is net bearish for market sentiment because two negative catalysts intersect: (1) a reported bug in Zcash’s Orchard Pool privacy protocol that triggered a ZEC price slump, and (2) continuing overhang from BitForex’s fraud allegations and frozen withdrawals (a reminder of counterparty/exchange risk even if the current trades are on a DEX). While the reported ZEC short generated an unrealized profit for Garrett Jin, that outcome is not a bullish signal for ZEC broadly—rather it reflects that technical/privacy failures can quickly pressure price and boost downside volatility. In similar past patterns, privacy/protocol security incidents often lead to short-term selloffs and wider spreads, while recovery depends on confirmation of fixes and user confidence; unresolved credibility issues around exchanges can further depress risk appetite. Expect short-term trader focus on ZEC volatility and derivatives positioning, and longer-term caution toward privacy infrastructure and any related ecosystem risks.