Bitcoin Flash Crash Impacts Gaming Tokens
Bitcoin’s recent flash crash has had a significant impact on various gaming-related tokens. The crash, which saw Bitcoin decline by approximately 7%, caused a domino effect that resulted in gaming tokens losing between 5% and 15% of their value.
Tokens such as Immutable’s IMX, The Sandbox’s SAND, Axie’s AXS, GALA, BEAM, and ApeCoin all experienced notable decreases in their prices. Additionally, other gaming tokens like GMT, Enjin Coin, PRIME, and WAX also faced losses.
It’s important to note that these cryptocurrencies were already experiencing declines before Bitcoin’s flash crash exacerbated their losses.
Over $500 Million in Longs Liquidated
The flash crash led to the liquidation of over $550 million in long positions. A total of 172,626 traders were liquidated, with OKX, Binance, and Huobi being the top exchanges for these liquidations.
Bitcoin-tracked futures saw $110 million in both short and long liquidations, while Ethereum-linked futures experienced over $82 million in liquidations.
Despite the overall downturn, some tokens managed to make gains during the crash. Axie’s Smooth Love Potion (SLP), Yield Guild Games’ YGG, and Oasys experienced increases in their prices.
Gaming Tokens Face Challenges Amidst Milestones
While the current situation may be challenging for gaming tokens, it’s worth noting that some of them have recently achieved notable milestones. IMX reached a 20-month high last month, while GALA witnessed an 18% gain during the same period.
Bitcoin Drops on ETF Delay Rumors
The flash crash occurred as Bitcoin dropped to as low as $40,000 following rumors of a potential rejection of spot Bitcoin ETF applications by the SEC. Matrixport’s report projected a January rejection and warned traders to hedge their long exposure.
“With SEC Chair Gensler’s skepticism towards crypto, a potential -20% Bitcoin price drop is anticipated upon ETF denial, though a positive end-of-2024 outlook remains.”
Hot Take: Gaming Tokens Suffer from Bitcoin’s Volatility
Bitcoin’s flash crash had a significant impact on the gaming token market, with various tokens experiencing losses in their value. While some tokens managed to make gains amidst the chaos, others faced notable declines. The crash also led to over $500 million in long positions being liquidated. Despite these challenges, some gaming tokens have recently achieved milestones, indicating potential for future growth. However, rumors of a potential rejection of spot Bitcoin ETF applications have further added to the volatility of the market. It remains to be seen how gaming tokens will navigate these challenging times and whether they can recover from the recent downturn.
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