Crypto Shorts Experience High Liquidations Amid BTC Rally
The cryptocurrency market has been volatile, with Bitcoin and other assets experiencing a sharp surge in bullish momentum. This volatility has led to chaos in the futures market.
Liquidations in the Crypto Futures Market
In the past 24 hours, the crypto futures market has witnessed liquidations totaling nearly $120 million. Out of this amount, short contracts accounted for almost $86 million.
Most of the volatility during this period came from various assets in the sector, causing shorts to bear the brunt of the liquidation. This event is referred to as a “short squeeze.”
Distribution of Liquidations
The majority of the short squeeze, approximately $65 million, occurred within the last twelve hours. This aligns with the period of heightened volatility.
Bitcoin futures contracts contributed the largest portion of today’s liquidation flush, followed by Ethereum. Chainlink (LINK) and Solana (SOL) also experienced high liquidations due to their significant rallies in recent weeks.
Common Occurrences in the Crypto Sector
Liquidation squeezes like today’s are not uncommon in the crypto sector due to the high volatility of most assets. Traders remain undeterred by these liquidations, as evidenced by the increasing Bitcoin open interest.
The graph shows that the open interest in Bitcoin futures is approaching $10 billion, indicating continued trader participation.
BTC Price
Bitcoin briefly surpassed the $30,900 mark before experiencing a pullback. However, it is still trading around $30,600.
Hot Take: Crypto Shorts Liquidated as BTC Surges
Data reveals that the crypto futures market has seen a significant number of liquidations in the past day. This comes as Bitcoin rallied towards $31,000, causing chaos and volatility. The majority of these liquidations were short contracts, resulting in a “short squeeze.” Bitcoin futures contributed the largest portion of the liquidation flush, followed by Ethereum and other altcoins experiencing remarkable rallies. Despite these liquidations, traders remain active in the market, as seen by the increasing Bitcoin open interest. As Bitcoin experiences a slight pullback from its recent surge, it continues to trade around $30,600.
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