Chapter 219: Get rid of all short positions!
The long-to-short transition itself is easy to understand, but this time it is a bit special.
Under normal circumstances, it is selling a long order and reopening a short order, which are two transactions.
But now their long contracts are restricted, and they can only modify the contracts directly, which is equivalent to turning two transactions into one.
It all depends on whether Morgan agrees or not.
Li Yuan didn't believe they would refuse.
If a one in ten thousand record appears and they refuse it, they will find an opportunity to clear out the chips in Chen Jie's account and run away.
The price of Bitcoin has stabilized at around $31,000. At this level, the dealers are slowly releasing their chips.
There are many people behind them, and the data has been carefully calculated. It is most appropriate to release some chips at this position.
Because the price fluctuates around this range, people who buy it have no urge to sell it, which can help them lock up a portion of the chips.
And because the price has dropped by several thousand dollars from its highest point, I dare not open a short position at this level.
The overall atmosphere is quite rich.
Li Yuan not only bought, but also used five times leverage to buy.
In fact, with his funds, there is no need to use such a high leverage because he can't buy too much.
With $10 billion as the goal, it is unlikely to exceed $20 billion.
Not to mention whether there would be enough time, if they bought so much, those people at Morgan would be grinning so hard that their mouths would be crooked.
His purpose of using leverage is to reserve a portion of funds. His purpose of taking the chips is just to keep half a trump card for himself.
More than 10 billion US dollars in chips are not the main force this time.
As Yao Yingsong conveyed Li Yuan's meaning, the National Big Fund was the first to be shaken.
Li Yuan wants to fight to the death with Morgan?
According to Li Yuan, he was betting that Morgan would not dare to invest money.
"According to the price set by Li Yuan, Morgan will have to pay a lot of money. We have at least 16 billion US dollars, and Morgan will have to put 32 billion US dollars into our account."
"Li Yuan is just gambling. He is betting that Morgan will not be able to take out more than 30 billion and continue to raise the price of Bitcoin. If he wants to clear the more than 30 billion US dollars, he must at least raise the price of Bitcoin to 52,500 US dollars."
For the bankers behind the scenes, the biggest difficulty in every price increase is to fill it with funds.
To increase the market value by 10 billion US dollars, at least 2 billion US dollars must be added, otherwise it will not be able to sustain it.
Although the bubble is getting bigger and bigger, the actual situation is that more and more money is being spent.
From the very beginning, Bitcoin’s market value of more than 100 billion US dollars can be played with 30 to 50 billion US dollars.
The current market value of Bitcoin exceeds 400 billion, and the scale of funds contained in it has exceeded 100 billion.
If the price of Bitcoin rises to more than 50,000 US dollars, its market value will exceed 700 billion.
This is a terrifying market value, which cannot be controlled by one or two institutions.
The data involved is also more complex.
"Is there a possibility that Li Yuan is retreating to advance? With the short order , if Morgan doesn't unplug the network cable, he can trade. Unless Morgan blows him up in a very short time, Li Yuan can get out. At most, he will lose some money. At the very least, it's better than being restricted before."
This sentence caused everyone to think.
As long as there are no restrictions, with Li Yuan's ability, it should not be a problem for him to come up with billions of dollars.
Some people's eyes lit up, "This is a good move!"
They were already very satisfied to be able to get back billions of dollars; they had never thought this would be possible before.
The main reason is that the situation is not clear .
"So let's do it?"
“But what if Morgan drives the price of Bitcoin up to $60,000? Or even higher? Those short orders…”
A basin of cold water was poured down.
If that happens, they will still owe tens of billions of dollars.
“So Li Yuan still has to take a big risk this time. Who knows how high the price of Bitcoin will rise?”
"But since he said so, he should have considered these things. And now Li Yuan is actively helping us, we have no reason to refuse. If it really causes a bigger loss... maybe it will be a good thing. Li Yuan will feel guilty and cooperate with us for a few more periods..."
Sure enough, after thinking about the problem from a different angle, everyone suddenly understood.
Regardless, this is a good thing.
So, the matter was settled.
Li Yuan did not receive the message from Yao Yingsong until around four o'clock in the afternoon, and by then the price of Bitcoin had already begun to rise slowly.
Around eight o'clock in the evening, Bitcoin once again reached a high of 35,000 US dollars. At the same time, Morgan made contract changes.
Thirty-two billion US dollars went directly into the account of Sky Capital, but the money was restricted and could only be used to repay short contracts. After the contracts were repaid, any money left would be their profit.
So, the lower the price of Bitcoin, the lower the value of their contracts, and the more money they have left after repayment.
This contract is not displayed on the board, but the dealer has actually taken out the money.
The people at Sky Capital can’t sleep.
People at the National Big Fund can't sleep.
The Bitcoin dealer can’t sleep.
Li Yuan's conversion of this contract directly brought the atmosphere on the battlefield to its highest point.
The dealer does not allow Li Yuan and others to escape at this position, so he can only push the price up.
At the same time, as the price of Bitcoin rises, more short orders will flow in from the OTC market, and they face great challenges.
But they must eat up Li Yuan's money. As long as they let their positions go bankrupt, the 32 billion US dollars will become their high-priced buyer, allowing them to leave with huge profits.
It was indeed very stressful for them to raise more than 50,000 US dollars.
Together with Li Yuan's more than 30 billion, they have invested hundreds of billions of dollars in Bitcoin. This is too much money.
Next, the control over the disk will be more stringent.
They also knew that a few hours ago, more than 10 billion chips were traded, and that chip was a long order at this time.
If that capital does not crash the market, they have a good chance of pushing it up without spending much money.
They are not afraid even if there are overwhelming short orders.
The more short orders you have, the more you earn.
What they fear most is that long orders will crash the market at a critical moment.
However, faced with Sky Capital's $16 billion in profits, they had no choice.
This is the largest short order. As long as the price goes up by 50 points, the US$16 billion can be earned.
Even if the price rose by 50 points, the profit earned from that long order would not be as high as theirs.
Not to mention that more short orders will be generated in the process of rising.
Overall, success or failure depends on this one move.
Bitcoin has skyrocketed for three consecutive days, which has caused a big stir around the world. The number of people watching is at least tens of millions, and the number of participants will also increase by an order of magnitude.
This is their last chance. If they fail to seize this opportunity, the entire Bitcoin market will be in trouble and no one will be able to control the market.
Whoever controls the market will kill Bitcoin.
They have to make enough money today and then bring the price of Bitcoin down.
As long as you can recover the cost and then lower the price and wait for other big funds to enter the market, it doesn’t matter if you don’t make money this time. Anyway, you still have the chips in your hand and can get the profit back later.
Their plan is complete enough.
After defeating Li Yuan, he will sell off one third of his chips immediately.
Then he started to crash the market himself, selling one-third of his chips and finally keeping one-third.
It is not difficult to recover the cost of two-thirds of the chips. It has been calculated through big data models and there will be no problem.
Anyway, the contract is there and you can't escape it.
They have a clear grasp of all the short orders in the market.
Li Yuan's position was liquidated, and other contracts will also be liquidated. The liquidated funds are at least 70 billion US dollars.
They only need to make an effort in the early stage, and those accounts that have been liquidated in the middle and late stages will be forcibly liquidated and bought out, and they don't need to spend any more money.
The whole thing is divided into four steps.
The first step is to raise the price to 37,000 US dollars, absorb short orders, and get ready.
The second step is to directly raise the price to 50,000 US dollars, leaving no opportunity for short orders, and instantly blow them up. At this time, close the short-selling channels of the small platforms they control and prohibit other short orders from entering the market.
The third step is to wait for those short positions to trigger forced liquidation, and then push the price up to 53,000 US dollars, thus bankrupting Sky Capital.
The fourth step is to start selling at this position and accept funds from Kingkong Capital.
They didn't think about continuing to pull the trigger and causing Sky Capital to lose more money.
It's not that they don't want to, but that they can't.
At twelve o'clock at night in China, the first step was proceeding in an orderly manner, and the short positions were slowly increasing.
At two o'clock in the morning in China, the short orders absorbed had exceeded 6 billion US dollars, while the short orders reduced were less than 10 billion US dollars. The first step has been completed.
To start the second step, multiple platforms worked together to push up the price instantly at 2 a.m., mobilizing nearly 10 billion U.S. dollars in funds and directly raising the price to 50,000 U.S. dollars in an extremely short period of time.
All in all, it took thirty-six seconds.
During these thirty-six seconds, many platforms were completely unable to place orders as the ordering channels were blocked.
By the time they reacted, it was too late.
All short positions were blown up, triggering liquidation.
Scattered long selling cannot prevent the system operation after closing the positions, and the price of Bitcoin continues to rise.
However, at this moment, the rising price was suddenly suppressed by a large short order.
They thought that the higher the price, the more short orders there would be.
But I never thought that someone would dump so many short orders.
They have already shut down the "short orders" of those small platforms in order to prevent anyone from opening short orders crazily at high levels.
However, Morgan's platform did not dare to openly shut down the service, and at most it restricted individual accounts.
After all, if they also cut off the power supply, the loss of credibility will be too great.
However, more than 40 billion US dollars of short orders were forcibly created on its own platform, and the funds that were liquidated were forcibly taken over.
They should have been the ones to reap the money.
At this point, the third step was only halfway done when it was forcibly suppressed.
They had no choice but to invest nearly 20 billion US dollars again to eat up this money.
Then continue to pull up.
Through the contract, they learned that the other party had used five times leverage.
In other words, if it goes up another twenty points...
You have to know that as a platform, they also have to provide contracts, so they cannot use leverage on their chips.
After all, someone wants to buy 5 billion, you can't give him 5 billion leveraged chips, right?
That would be double leverage, and it would explode in an instant.
If you want to increase it by another 20 points, it is not impossible, but the financial pressure is too great.
At the same time, a more dangerous situation emerged. Many big funds discovered that there were still people who could open short contracts, and they all poured into the big platforms.
They gradually found it difficult to cope with it.
The price of Bitcoin once fell below $50,000.
At this time, they had only one option, which was to close Morgan's short-selling channel.
It’s just that… too many of the short orders that have poured in during this period are from Western funds, so they don’t dare to impose restrictions.
Unlike before, when they dared to deal with Kingkong Capital, they knew that if Kingkong Capital suffered losses, they would have to bear it and no one would speak for them.
Closing the short-selling channel is already the limit.
Loss of reputation is inevitable, so the first thing to do is to protect your funds.
As long as there is no restriction on short orders, the reputation lost now can be restored later.
They are a world-class group and they did not close the channel at the beginning out of considerations of their reputation.
As a result, some problems still occurred.
This step is at best a last-ditch effort.
From the moment that $40 billion short order was placed, the entire plan went drastically off track.
Analysts began to nervously calculate how much funds would be needed .
The calculation results show that it will cost less than 20 billion US dollars.
However, this result will definitely come with a price.
The price is that the number of chips in their hands will exceed 110%...
Nearly half of the chips were short positions...
Originally, they had about 50% of the chips in their hands, and had been absorbing chips during the rising phase. At the same time, they took the chips in their hands to the platform to open contracts, and then took over the short contracts opened.
Almost 50% of the chips are short.
They nominally own 110% of the chips.
To put it simply: there are ten apples on the market, they buy five, and then lend these five out as a contract, and then buy another one. After raising the price of apples, they let those who bought their apples sell them, and they buy another one.
In this way, there are four apples on the market with no one buying or selling them, so they have six apples, plus the five owed by others, which makes eleven apples.
The remaining four apples, when placed in Bitcoin, would constitute a dead chain.
Because according to the survey, the scale of Bitcoin's dead chains accounts for 38% of the current market volume. This data was calculated before they participated, that is, four months ago.
If placed in the stock market, the four apples would be equivalent to restricted stocks, which would not participate in market circulation and would have no value in themselves.
They just want to sell all the apples they have, and keep the apples returned by others as profit.
But the current situation is that the number of apples on hand exceeds expectations, and it is difficult to sell them all.
Not only that, some people are borrowing Apple now.
The more apples you lend out, the more you will end up with.
From the beginning, I wanted to sell short, and now I want to get rid of all those shorts...
