A newly created cryptocurrency wallet has entered a 10x leveraged long position in 20 million Dogecoin (DOGE), drawing market attention.

On May 16, the blockchain outlet The Crypto Basic reported that the position size was about $2.25 million. The high leverage and tight liquidation range became a talking point among investors.

Data from on-chain analytics platform Lookonchain showed the new wallet entered the position on terms of buying Dogecoin at $0.11335 each. On the disclosed screen, Dogecoin was priced at $0.11273, and the unrealised loss at that point was about $12,410.

Dogecoin later fell to as low as $0.11027, widening the loss to about $60,724. The trader is maintaining the 10x leveraged position. The liquidation price is set at $0.10284. If Dogecoin falls to that level, the trading platform will automatically close the position to prevent further losses.

The market is focusing more on the nature of the trader than the size of the trade itself. That is because the wallet is a newly created address and used aggressive 10x leverage. Some Dogecoin investors view the trade as a high-risk bet, or as a position taken with the possibility of bullish catalysts for Dogecoin in mind.

Some have assessed that the structure is hard to choose without strong conviction of a rise, because the liquidation price is only about 9 percent below the entry price. The fact that the trader is keeping the position despite the high leverage is being interpreted in the same context.

The trade coincided with a period when selling pressure across the broader cryptocurrency market picked up again. Over the past 24 hours, bitcoin fell 2.75 percent, ethereum fell 2.76 percent, BNB fell 3.60 percent and XRP fell 3.72 percent. Dogecoin also dropped 4.24 percent over the same period.

Liquidations of leveraged positions also rose quickly amid the broader market correction. Over the past 24 hours, total crypto market liquidations were about $575 million, of which long-position liquidations accounted for $549 million. Liquidations by bitcoin and ethereum traders were tallied at $188 million and $151 million, respectively. Liquidations of leveraged Dogecoin positions also reached about $9.55 million.

In this situation, the new wallet's large Dogecoin long position is being watched as a case for gauging market sentiment beyond a high-multiple trade. The near-term focus is whether Dogecoin can hold above the liquidation price or face additional pressure in a declining market.