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Sudden Crypto Volatility Spurs $216M in Losses, Liquidating Both Long and Short Positions

Sudden Crypto Volatility Spurs $216M in Losses, Liquidating Both Long and Short Positions

CoindeskCoindesk2023/06/30 17:08
By:Krisztian Sandor

Cryptocurrency prices rose early Friday but then dropped sharply following a report that the SEC had deemed recent spot BTC filings inadequate.

Crypto liquidations (CoinGlass)

Quick swings in cryptocurrency prices on Friday wiped out traders of both long and short positions, totaling $216 million of losses in liquidations over the past 24 hours, CoinGlass shows.

Bitcoin () rose above $31,200 early Friday, before quickly plunging to as low as $29,470, CoinDesk Indices data shows, as traders about the U.S. Securities and Exchange Commission () deeming recent filings for spot bitcoin exchange-traded funds inadequate.

After that initial shock, BTC stabilized at around $30,000 and by press time had begun to recoup some losses, returning to just shy of $30.5000. Other cryptocurrencies largely followed BTC’s price action in both directions.

The volatility wiped out more than 68,000 traders, per CoinGlass, liquidating $116 million of long (bets on higher prices) and $100 million of short (bets on lower prices) positions. happen when an exchange closes leveraged positions due to a partial or total loss of the initial margin because the trader doesn’t have enough funds to keep the position open.

BTC traders endured $65 million of losses, mostly liquidating longs, followed by ether () traders with $36 million of mostly short liquidations.

Bitcoin cash (), was responsible for $22 million of liquidations. The almost tripled its price in June and experienced a resurgence in trading activity after being one of the four assets listed on , a new crypto exchange backed by traditional finance heavyweights Citadel, Fidelity and Schwab.

The largest single liquidation order happened on the Bybit exchange, a BTC-USD position valued at $4.57 million.

Edited by Nelson Wang.

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Disclaimer: The content of this article solely reflects the author's opinion and does not represent the platform in any capacity. This article is not intended to serve as a reference for making investment decisions.

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