The complete loss of a trader’s total invested capital, specifically as a result of shorting Bitcoin.
The term “ashdraking” was coined following the activities of Lord Ashdrake — a pseudonymous Romanian Bitcoin trader who was prominent in the mid-2010s.
He enjoyed significant success between 2014 and 2015, a period of precipitous losses in which Bitcoin lost nearly half its value, and he became a prominent voice encouraging traders to adopt short positions.When Bitcoin broke $300, Lord Ashdrake again shorted the currency — but this time the market was not in his favor.
The CBOE launch was considered a key test for Bitcoin, and the generally crypto-skeptic mainstream financial press strongly predicted that institutional investors would take large short positions en masse.
This did not happen, with the futures posting huge rises within just a few hours. This caused some prominent brokers to completely forbid their clients from taking short positions because of a fear that they too would be “Ashdraked.”Lord Ashdrake (or someone claiming to be him) remains a prominent voice in the crypto community. In October 2020, he gave an interview to blogger zoomerjd, in which he talked extensively about the notorious incident.