The crypto market today can really only be described as a true bloodbath. The prices of almost all cryptocurrencies fell by double digits and even bitcoin (BTC) and ethereum (ETH) went down completely. This was accompanied by a cascade of liquidations. At least 250,000 traders saw their positions closed with a total loss of almost $1 billion!
Crypto liquidations
The bitcoin price plunged below $24,000 today. That means that many traders who lung positions open were forced to close those positions at a loss. A long position is a trading position where the trader uses leverage, i.e leverage, is betting that the price of the underlying assets will rise. Most trading platforms have automatic systems that ensure that you cannot lose more than your bet and automatically close the position if you lose too much. This is called a liquidation.
Traders with long positions have been hit hard in the past 24 hours. The total value of liquidations during this period amounts to a staggering $968 million at the time of writing, according to dates from CoinGlass† While the majority of liquidations were long liquidations, this does not mean that short traders were spared. The ongoing price swings caught many traders by surprise and their positions were also liquidated in the blink of an eye.
259,000 traders were liquidated today as the price of Bitcoin, among others, fell to its lowest level in nearly two years. The largest liquidation volume was found with bitcoin traders. At least $408 million in value was liquidated here. Ethereum was not far behind at $368 million. Solana (SOL) is in third place with ‘only’ $19 million in liquidations.
The bitcoin pain is not over yet
There is a chance that the amount of liquidations will be even higher. It is by no means certain that bitcoin and the rest of the crypto market will not plunge further. Especially when the bitcoin price goes through the key point of $22,000 breaks there will most likely be a lot again lung traders are liquidated which could again usher in further downward price pressure.