With Bitcoin down about 8% in the past 24 hours, several traders have liquidated their positions, reaching a figure of US$499 million (R$2.5 billion). By including other cryptocurrencies, which have also suffered casualties, liquidations reach US$1.04 billion (R$5.2 billion).
The reason for the decline is said to be related to the increase in yields on US government bonds, which reached the highest level in the past 15 years. All in all, investors would be happy with returns of 4.3% per annum in dollar terms, excluding risky assets like BTC.
Of the BRL 5.2 billion liquidated, 80% were long positions, possibly from traders excited about the potential approval of the first Bitcoin spot ETF in the US.
Traders liquidated as cryptocurrencies melt
Of the top 100 cryptocurrencies in the market, only stablecoins seem to have survived. All others followed the fall of Bitcoin which, by surprise to many, wreaked havoc on wallets.
According to Coinglass data, the largest liquidations were in Bitcoin ($499 million), followed closely by Ethereum ($309 million). Other projects even showed a larger decrease, but caused less damage due to their lower volume.
“In the past 24 hours, 176,642 traders were liquidated, the total liquidations reach $ 1.04 billion.”
Although the market fell sharply, short positions accounted for 20% of liquidations. The reason is the high leverage used by some traders, who faced corrections.
Finally, cryptocurrencies also lost US$135 billion (R$670 billion) in market value, impacting more than traders. In any case, US$41 billion (R$200 billion) has already been recovered, indicating that the worst may be over.
Trader lost 273 million BRL betting on the rise of Ethereum
Another interesting data presented by Coinglass is the individual liquidations. According to the information, a single trader lost BRL 273 million while betting on the rise of Ethereum, which accounted for a large share of liquidations.
“The largest single settlement order was on Binance, on ETHBUSD, worth $55.92 million.”
The trader was trading on the ETH/BUSD pair and sold out at the all-time low as per the times. That is to say, he ended up having some bad luck, because soon after, the market went up again.
Finally, there are always people who take advantage of these declines to make new contributions and lower their average entry price. After all, analysts still believe that Bitcoin could hit $150,000 with the approval of a spot ETF in the US.
Source: Live Coins
Barry Siefert is an accomplished journalist and author at The Nation View. He is known for his expertise in the field of cryptocurrency, and has written extensively on the topic. With a background in finance and economics, Barry has a deep understanding of the underlying technology and market forces that drive the crypto industry.
