TL;DR
- More than $245 million were liquidated in the crypto market within 24 hours.
- Long positions dominated the losses with $161.96 million.
- Bitcoin and Ethereum were the most affected assets by volatility.
In the last 24 hours, the cryptocurrency market experienced an intense period of volatility, with liquidations exceeding $245 million, according to data provided by Coinglass.
Long positions were the most affected, reaching liquidations of $161.96 million, while short positions accounted for $83.48 million of the total.
This wave of liquidations was primarily driven by fluctuations in Bitcoin’s price, which ranged between $67,000 and $65,400 during a period of uncertainty for investors.
Ethereum stood out as the most affected in the market, accumulating losses of $73.16 million in liquidations, reflecting its vulnerability to recent volatility.
According to CoinGlass, the largest individual liquidation occurred on the OKX exchange, valued at $9.63 million in a BTC-USDT swap. This situation highlights the high leverage levels many traders handle, exposing them to significant risks in fluctuating markets like cryptocurrencies.
The activity on trading platforms also illustrated the magnitude of the impact. Binance led the liquidations with $9.40 million, mostly from long positions, which accounted for 73.55% of the total.
OKX and Bybit, on the other hand, reported significant liquidations of $4.70 million and $3.93 million respectively, with more than 86% of losses coming from long positions on both platforms.
The risk of over-leveraging in times of market volatility
The trend of massive liquidations in long positions demonstrates a recurring phenomenon in the crypto market: over-leveraging.
Many traders take on high risks in search of quick profits, leaving themselves vulnerable to liquidation events when prices move against their expectations. The recent Bitcoin fluctuation not only affected this particular asset but also dragged down other major cryptocurrencies like Ethereum, which saw considerable losses across the market.
CoinGlass also highlights that activity in the last four hours showed liquidations exceeding $20.30 million, reflecting an acceleration in market volatility.
The growing open interest in Bitcoin futures, which recently reached a new all-time high, seems to have contributed to this wave of liquidations, increasing pressure on prices.
This volatility and consecutive liquidations serve as a reminder to traders about the importance of proper risk management, especially in volatile markets like crypto.
Leverage strategies, while promising significant returns, can also result in devastating losses within hours, as demonstrated by this recent event.
The crypto market remains a high-risk environment, and investors must act with caution, particularly during periods of extreme volatility like the current one. The massive liquidations observed in recent hours are a clear indication of how market conditions can shift dramatically, affecting thousands of traders worldwide.
