As a seasoned cryptocurrency investor with years of rollercoaster rides under my belt, I can’t help but feel a sense of deja vu as I watch the market tumble once again. The crypto world has always been unpredictable, and this latest downturn is just another reminder that we never know what’s around the corner.
In simple terms, the value of cryptocurrencies took a tumble when over 1 billion dollars worth of assets were sold off in just one day, triggered by Bitcoin‘s sudden plunge below $100,000. This market decline started after the Federal Reserve Chairman, Jerome Powell, stated on Wednesday that US bank regulators are legally forbidden from owning Bitcoin.
With the Fed’s last interest rate reduction for the year and the announcement that followed, investors everywhere experienced a wave of fear. Just two days prior, Bitcoin had reached an unprecedented high of $108,000, but today it dropped to $96,000, erasing billions from the market and forcing the unwinding of overleveraged positions.
Massive Liquidations Hit Long Traders Hard
According to CoinGlass data, more than 304,679 market participants experienced significant losses due to the market turmoil. The majority of these losses were suffered by those who held long positions, totaling approximately $869.88 million in losses. Conversely, short traders only saw a comparatively smaller amount of liquidations amounting to $164 million during this period.
The largest single liquidation occurred on Binance, where a trader lost nearly $16 million.
The main locations where liquidations took place were centralized exchanges. Binance was at the forefront, handling over $450 million in terminated positions, as reported by CoinGlass. Other significant players like OKX, Bybit, and HTX (previously known as Huobi Global) also played a substantial role in this ongoing market crash. They respectively lost approximately $210 million, $215 million, and $86 million from their platforms during this time.
Crypto Market Cap Plummets Amid Widespread Losses
The overall value of the cryptocurrency market has decreased by over 5% after approximately $1.04 billion in assets were liquidated, as per data from CoinMarketCap. Currently, the crypto market stands at a valuation of around $3.34 trillion.
These popular digital currencies like Ethereum, Cardano, Avalanche, Shiba Inu, and Dogecoin have each experienced significant losses, with drops of around 7%, 9%, 11%, 10%, and 12% respectively.
Despite maintaining a 1-to-1 parity with the U.S. dollar, prominent stablecoins like Tether (USDT) and Circle USD (USDC) have exhibited minor variations, causing some unease among investors.
As Bitcoin hangs on at around $96,000 and various altcoins experience significant declines, speculation arises as to whether this could signal the sudden conclusion of the ongoing bull market.
Currently, investors are keeping their fingers crossed, anticipating tranquility as the crypto market experienced a bumpy and expensive day so far.
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2024-12-20 01:45