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Bitcoin's Slip Below $30,000 Leaves Traders Liquidated

In short: Bitcoin's drop below its previously stable threshold of $26,000 has resulted in a surge of total liquidations, with roughly $304 million lost as 112,837 traders were forcibly closed in 24 hours. Binance and OKX were the top exchanges involved in the liquidations. Long positions bore most of the losses, accounting for 91.22% of the total, while short positions faced a nearly 10% shortfall. Bitcoin lost over $20 billion from its market cap in the past 24 hours and the global crypto market cap also fell below $1.2 trillion. However, some traders profited by strategically shorting their positions.

Our quick analysis:
Bitcoin, the largest cryptocurrency by market capitalization, recently experienced a significant dip below $30,000, leading to a surge in total liquidations among traders. This downward spiral had ripple effects across the market, with major exchanges recording substantial liquidation figures.

As per Coinglass data, traders lost more than $300 million within 24 hours as roughy 112,837 traders were liquidated. The market volatility led to an overwhelming presence of long position traders, and they bore the brunt of the liquidations, accounting for approximately $277.45 million (91.22%) of the total losses.

Additionally, short positions also faced liquidations, amounting to approximately $26.71 million or nearly 10% of the total loss. The widespread liquidations also impacted Ethereum (ETH), which recorded liquidations totaling $33.87 million.

Although certain traders predicted the downward movement and capitalized on the market movement by shorting their positions, those who had anticipated a price increase faced significant losses. This includes a single trader on Bitmex, who recorded an astonishing $9.94 million loss in an XBTUSD swap, underscoring the scale of the market upheaval.

Bitcoin's dip also affected the market as a whole. The global crypto market cap slumped below the previously established $1.2 trillion mark, and at the time of writing, BTC trades below $26,000. The daily trading volume has, however, increased from $11 billion last week.

While the repercussions of the event continue to reverberate across the cryptocurrency market, it is yet to be seen how it impacts long-term investments in the cryptocurrency market. As always, the market will remain a battle between the bulls and bears, with traders treading carefully during times of market upheaval.

Image provided by Unsplash
Disclaimer: Our articles are NOT financial advice, and we are not financial advisors. Your investments are your own responsibility. Please do your own research and seek advice from a licensed financial advisor beforehand if needed.

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