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Bitcoin and Ether Drop Leading to $500M Liquidations

bitcoin and ether

Bitcoin and Ether experienced a tumultuous trading session on Monday, resulting in a staggering $500 million in liquidated positions within the crypto futures market. The sharp volatility adversely affected highly leveraged long and short positions, triggering substantial losses.

Bitcoin and Ether Volatility Hits Major Tokens

During this session, Bitcoin (BTC) displayed erratic behavior, plunging from $43,000 to as low as $40,300. This drastic movement also influenced other major tokens like Chainlink (LINK), Cardano’s ADA, and Solana’s SOL, which suffered drops exceeding 8%. Even riskier bets such as shiba inu (SHIB) and dogecoin (DOGE) encountered a 5% decline. Conversely, BNB Chain’s BNB, Avalanche’s AVAX, and Celestia’s TIA remained resilient, exhibiting gains of up to 20%, unfazed by Bitcoin’s weakness.

The market turmoil resulted in substantial losses, with approximately $475 million in longs (bets on higher prices) and $73 million in shorts (bets against prices) facing setbacks due to unwinding leveraged bets. This action transpired amidst high funding rates, creating an uncertain market environment.

Read More: These Ethereum Whales for 2023 Making Noise

Magnitude of Liquidations

The crypto market witnessed liquidations surpassing $500 million over the last 24 hours, primarily concentrated on OKX at $190 million, followed by Binance at $148 million and Huobi at nearly $60 million. The largest single liquidation order, valued at over $33 million, occurred on Bitmex, involving a chainlink (LINK) futures position.

Liquidations occur when exchanges forcibly close leveraged positions due to traders experiencing partial or total losses of their initial margin. This situation arises when traders fail to meet margin requirements for their leveraged positions, lacking sufficient funds to sustain the trades.

Bitcoin and Ether Market Watchers’ Perspectives

Amidst these fluctuations, certain market analysts suggest that Bitcoin’s recent rally was supported by robust fundamentals, propelling it into an unprecedented era described as “never seen before.”

Read More: Bitcoin 2023 Surge Triggers 7.5% Plunge

Bitcoin and Ether’s recent volatility has sparked widespread liquidations and fluctuations across major tokens, highlighting the challenges and risks present in the crypto futures market. Understanding the dynamics behind these events remains crucial for investors navigating this increasingly volatile landscape.


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