Bitcoin’s $102K Rally Sparks $300M Crypto Liquidation Frenzy!

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The data indicates that the market for cryptocurrency derivative contracts has experienced significant unwinding over the past 24 hours, coinciding with the recent surge in value for Bitcoin and other digital assets.

Both Crypto Long & Short Liquidations Have Been High Today

Data from CoinGlass indicates that there’s been a buildup of liquidations in the derivatives market within the cryptocurrency sector due to recent market fluctuations.

As a researcher, I’d like to explain that when we use the term “liquidation,” we’re referring to the compulsory ending of any active contracts. This happens when these contracts have suffered significant losses, the specific threshold for which can vary across different platforms.

Here’s a table displaying information about the crypto-liquidation events that took place over the past 24 hours.

This table provides insights into the recent liquidations in the cryptocurrency market within the last 24-hour period.

In this particular analysis, I’ve observed that approximately $306 million worth of liquidations have taken place during this timeframe. Interestingly, $154 million of these were associated with long positions, whereas a similar amount, $151 million, was related to short positions.

This almost equal division indicates neither side of the market experienced more influence than the other, a fascinating observation given the backdrop that Bitcoin and other cryptocurrencies have witnessed price surges over the past 24 hours.

It seems traders are keen to establish bullish positions using considerable leverage during this market recovery, which means they may be caught off guard by brief downturns or corrections, thereby contributing to an increase in long position liquidations.

Regarding the amount of liquidations triggered by each symbol, Bitcoin dominates yet again, accounting for nearly $98 million in such transactions.

In a notable turn of events, Ethereum (ETH) and Ripple (XRP) have secured positions in the top three, each registering significant liquidation amounts of around $37 million for ETH and $25 million for XRP. Interestingly, these two cryptocurrencies also hold leading spots on the market capitalization list.

As a researcher, I’ve noticed an intriguing discrepancy between rankings: in liquidations, Dogecoin (DOGE) doesn’t seem to align with the market cap ranking. Interestingly, it’s Dogecoin that’s closely trailing XRP, with approximately $16 million in contracts. This significant involvement in the ‘squeeze’ may be due to Dogecoin’s popularity, which seems to attract more speculator attention than larger altcoins such as Solana (SOL), possibly because of the hype surrounding it.

Speaking of recent developments, I’ve noticed a decrease in Bitcoin’s Open Interest compared to its market capitalization. This observation was made by analyst James Van Straten in a recent post.

The term ‘Open Interest’ represents the collective sum of ongoing Bitcoin derivative contracts across all centralized platforms. High levels of speculation often cause price fluctuations in the asset, making it desirable to keep the ratio of this figure to the market capitalization as small as possible.

The graph indicates a significant increase in the ratio to approximately 2.8% in November, which has subsequently decreased and stabilized around 2.4%. This seems to be a more balanced figure now.

Bitcoin Price

In simpler terms, the price of Bitcoin has climbed back up today, surpassing the $104,000 milestone in its ongoing recovery effort.

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2025-01-18 08:10