0
0
The volatile crypto market has been on fire since the beginning of 2018, with a swath of gains and losses. The price of Bitcoin is down 5% over 24 hours as pundits debate whether or not this could be another bubble-bursting event in the history of cryptocurrency.
Bitcoin has been falling for the past few days, with the price dropping over $4,000 yesterday. There was a lot of longs liquidated due to this drop in price.
Bitcoin dropped roughly $4,000 in a single day this morning, forcing over $500 million in ‘long’ liquidations in the larger crypto market.
On Tuesday, funding rates were high across the board, prompting some traders to predict a market slump. “The level of open interest has reached an all-time high. Before we move higher, let’s conduct a little bullish shakeout,” tweeted Lex Moskovski, CIO of Moskovski Capital.
The level of open interest has hit an all-time high.
Before we continue higher, let’s conduct a little bullish shakeout. pic.twitter.com/RGgQieEihE
November 9, 2021 — Lex Moskovski (@mskvsk)
For the uninitiated, ‘liquidations’ occur when leveraged positions are closed down automatically by exchanges/brokers as a “safety measure.” Futures and margin traders put up a modest amount of collateral before executing a deal, as they borrow funds from exchanges (typically in multiples) to make larger wagers.
Funding rates, on the other hand, are payments made to long or short traders on a regular basis depending on the spread between the perpetual contract market and the spot price. The perpetual futures contract price is comparable to the index price due to funding rates.
Higher financing rates frequently signal a shift in the other direction, resulting in a cascade of futures product liquidations.
Such conduct was evident in the market this morning. Nearly $500 million in ‘longs,’ or traders speculating on higher prices, were liquidated, according to Coinfloor statistics. Binance accounted for $235 million, while OKEx accounted for $196 million.
Liquidations totaled $200 million, with Ethereum ($96 million), Polkadot ($37 million), and XRP ($27 million) following closely behind.
Overall, 172,378 traders were liquidated, with the highest liquidation order—a $10 million XBTUSD—happening on Bitmex.
Gain a competitive advantage in the cryptoasset market.
As a premium Edge member, you’ll get additional crypto insights and context in every story.
Analyses of the whole chain
Snapshots of prices
a little more context
For just $19 a month, you can become a member right now. Examine all of the advantages.
Like what you’ve seen so far? Stay up to date by subscribing.
Cryptocurrency liquidation means the sale of an investor’s long position in a cryptocurrency. A liquidation can be accomplished by selling all of one’s holdings, or it can be done gradually over time through the use of stop-loss orders. The latter is known as “selling into strength” and is typically used to reduce risk. Reference: crypto liquidation meaning.
Related Tags
- bitcoin liquidation today
- crypto liquidations live
- crypto liquidations chart
- crypto liquidation data
- crypto liquidations rekt
