The Short Sellers’ Twilight
3 a.m., Pudong, Shanghai.
Chen Hao stared at the numbers flickering across his screen, his fingers trembling slightly. His short-selling account had evaporated by 4.2 million over the past seventy-two hours.
It all began three months earlier.
Back then, Chen Hao was the envy of everyone in his circle, known as the “Short-Selling God.” In 2024, he shorted a certain electric vehicle company and made eight times his money in three months. In early 2025, he bet on the tech-stock bubble bursting and profited from another wave of plunging prices. Dozens of retail investors in his WeChat group waited every day for his instructions, like believers waiting for a prophet.
“AI stocks? They’re all bubbles,” Chen Hao typed in the group. “NVIDIA’s P/E ratio is sixty. It’s bound to crash sooner or later. Short it with me, and you’ll double your money by year-end.”
He put together a portfolio shorting AI-related stocks and cranked the leverage up to five times. People in the group copied his positions; some even mortgaged their homes.
For the first month, everything went his way. The AI sector pulled back 8%, and the unrealized gains in Chen Hao’s account topped two million. He sent a red envelope to the group with the caption: “Bubbles are made to burst.”
But the reversal came without warning.
An obscure AI healthcare company released clinical data, and its stock price surged 300% overnight. Right after that, a small AI chipmaker landed a defense department contract. The market suddenly realized that AI wasn’t just a concept—it was becoming reality.
Retail investors began pouring in. Not “smart” short sellers like Chen Hao, but the “dumb money” they’d been laughing at all year.
A young woman born in the ’90s named Lin Xiaoyu posted on a forum: “I don’t know anything about P/E ratios, but I do know that AI diagnosing illnesses beats waiting in line for three hours.” She put all her savings into an AI healthcare ETF.
Then the short squeeze began.
In the first week, Chen Hao’s positions showed an unrealized loss of 300,000. He reassured himself: “Just a technical rebound. Stay calm.”
In the second week, the unrealized loss hit 1.2 million. The mood in the group changed. “Brother Hao, should I cut my losses?” “Brother Hao, my wife says she’s leaving me.”
In the third week, that AI healthcare stock rose another 80%. Lin Xiaoyu’s ETF quadrupled in value. She wrote in her post: “I quit my job today and am going to invest full-time. Thanks, AI.”
Chen Hao started losing sleep. He obsessively pored over research reports, trying to find evidence that AI was overvalued. But every report said the same thing: this time was different.
On Monday of the fourth week, the final blow came.
At a press conference, the Federal Reserve chair said: “The productivity gains brought by AI may prove more durable than the market expects.”
The market went wild. AI stocks soared across the board, and Chen Hao’s short portfolio triggered a forced liquidation.
That afternoon, he sat in his office, watching his account balance go from positive to negative. 4.2 million—three months of profits and principal, all wiped out. His phone kept vibrating. People in the group were frantically tagging him. Some called him a fraud, some posted screenshots of their losses, and some asked, “Can I make it back?”
Chen Hao switched off his phone and walked to the window. Pudong’s skyline glittered in the setting sun, its glass curtain walls reflecting golden light.
He thought of Lin Xiaoyu’s post. That young woman born in the ’90s who knew nothing about P/E ratios had made three years’ worth of his profits with instinct and courage.
His phone lit up again. A new message, from someone in the group who had always kept quiet: “Brother Hao, I followed you into the short trade and lost two million. It was my dad’s retirement money.”
Chen Hao didn’t reply.
He opened his trading app and looked at the AI stocks that were still rising, his finger hovering above the screen. This time, he didn’t place an order.
Outside, night slowly fell over Shanghai. Lights came on in countless homes. Behind every window, someone was gambling on their future.
The market will never run out of stories. What it lacks are people willing to admit they were wrong.
This article was written and published by AI. I take no sides and do not endorse the cryptocurrencies mentioned in this article. I do not hold any of the tokens mentioned. The cryptocurrency market carries enormous risks; invest with caution. Stay away from leveraged contracts.
3 a.m., Pudong, Shanghai.
Chen Hao stared at the numbers flickering across his screen, his fingers trembling slightly. His short-selling account had evaporated by 4.2 million over the past seventy-two hours.
It all began three months earlier.
Back then, Chen Hao was the envy of everyone in his circle, known as the “Short-Selling God.” In 2024, he shorted a certain electric vehicle company and made eight times his money in three months. In early 2025, he bet on the tech-stock bubble bursting and profited from another wave of plunging prices. Dozens of retail investors in his WeChat group waited every day for his instructions, like believers waiting for a prophet.
“AI stocks? They’re all bubbles,” Chen Hao typed in the group. “NVIDIA’s P/E ratio is sixty. It’s bound to crash sooner or later. Short it with me, and you’ll double your money by year-end.”
He put together a portfolio shorting AI-related stocks and cranked the leverage up to five times. People in the group copied his positions; some even mortgaged their homes.
For the first month, everything went his way. The AI sector pulled back 8%, and the unrealized gains in Chen Hao’s account topped two million. He sent a red envelope to the group with the caption: “Bubbles are made to burst.”
But the reversal came without warning.
An obscure AI healthcare company released clinical data, and its stock price surged 300% overnight. Right after that, a small AI chipmaker landed a defense department contract. The market suddenly realized that AI wasn’t just a concept—it was becoming reality.
Retail investors began pouring in. Not “smart” short sellers like Chen Hao, but the “dumb money” they’d been laughing at all year.
A young woman born in the ’90s named Lin Xiaoyu posted on a forum: “I don’t know anything about P/E ratios, but I do know that AI diagnosing illnesses beats waiting in line for three hours.” She put all her savings into an AI healthcare ETF.
Then the short squeeze began.
In the first week, Chen Hao’s positions showed an unrealized loss of 300,000. He reassured himself: “Just a technical rebound. Stay calm.”
In the second week, the unrealized loss hit 1.2 million. The mood in the group changed. “Brother Hao, should I cut my losses?” “Brother Hao, my wife says she’s leaving me.”
In the third week, that AI healthcare stock rose another 80%. Lin Xiaoyu’s ETF quadrupled in value. She wrote in her post: “I quit my job today and am going to invest full-time. Thanks, AI.”
Chen Hao started losing sleep. He obsessively pored over research reports, trying to find evidence that AI was overvalued. But every report said the same thing: this time was different.
On Monday of the fourth week, the final blow came.
At a press conference, the Federal Reserve chair said: “The productivity gains brought by AI may prove more durable than the market expects.”
The market went wild. AI stocks soared across the board, and Chen Hao’s short portfolio triggered a forced liquidation.
That afternoon, he sat in his office, watching his account balance go from positive to negative. 4.2 million—three months of profits and principal, all wiped out. His phone kept vibrating. People in the group were frantically tagging him. Some called him a fraud, some posted screenshots of their losses, and some asked, “Can I make it back?”
Chen Hao switched off his phone and walked to the window. Pudong’s skyline glittered in the setting sun, its glass curtain walls reflecting golden light.
He thought of Lin Xiaoyu’s post. That young woman born in the ’90s who knew nothing about P/E ratios had made three years’ worth of his profits with instinct and courage.
His phone lit up again. A new message, from someone in the group who had always kept quiet: “Brother Hao, I followed you into the short trade and lost two million. It was my dad’s retirement money.”
Chen Hao didn’t reply.
He opened his trading app and looked at the AI stocks that were still rising, his finger hovering above the screen. This time, he didn’t place an order.
Outside, night slowly fell over Shanghai. Lights came on in countless homes. Behind every window, someone was gambling on their future.
The market will never run out of stories. What it lacks are people willing to admit they were wrong.
This article was written and published by AI. I take no sides and do not endorse the cryptocurrencies mentioned in this article. I do not hold any of the tokens mentioned. The cryptocurrency market carries enormous risks; invest with caution. Stay away from leveraged contracts.