Almost $2 Billion Liquidated Overnight: Is Recovery Underway?

More than $1.89 billion worth of cryptocurrency futures positions were liquidated overnight forcing the price of BTC to correct, causing a subsequent sharp drop.

While the price of BTC reached a new ATH yesterday, in the last 24 hours almost $2 billion of cryptocurrency was liquidated. BTC and other coins fell, with Bitcoin falling below $46,000 on Binance.

As expected, the large part of the liquidation occurred on Bitcoin and Ethereum. The king cryptocurrency experienced $555 million in liquidation. While $336 million in ETH was liquidated. XRP, EOS, LTC also saw large liquidations has their market prices plummeted.

Binance led the pack with $993 million liquidated from the crypto exchange. Huobi also saw liquidation reaching $370 million. The least liquidation was on the Bitfinex platform.


According to Bitfinex chief technology officer Paolo Ardoino, 

Bitfinex has almost 1B in open interest but extremely low liquidation rate compared to competition. Finex seems to have traders that use leverage slightly more carefully.

Why the price dropped

Bitcoin enjoyed a relatively low drop in comparison to alt coins. Large altcoins and DeFi tokens saw big losses. Cosmos’ ATOM and SushiSwap’s SUSHI saw a whooping over 20% drop in 24 hours.

It is likely that the market prices saw huge correction due to altcoins futures market being extremely overheated for an extended period.

Platforms like Binance saw funding rates spike to around 0.3% to 0.7% in recent weeks. This was 30 to 70 higher than the average 0.01% in the past. This may explain why Bitcoin relatively fell at a lower 7% compared to altcoins and tokens drop.

In the same number of hours, Ethereum dropped 9%, a short-term weakness for the king altcoin.

This is important in the liquidation. Since the start of February, BTC/ETH have both enjoyed price growth reaching new ATH. The higher ETH drop had a negative effect on the altcoins market.

Recover underway?

Stablecoins are enjoying a high number of deposits in the past few weeks. This may be because stablecoins are easier to deploy in purchasing BTC than cash.

CEO of CryptoQuant, Ki Young Ju have noted the increase in stablecoins purchase may mean it’s high time people bought Bitcoin. It is expected a new bull rally may soon occur. He tweeted:

If you’re a long-term investor, now is the time to buy BTC. Not sure how many corrections would be along the way, but the on-chain indicator says there are enough stablecoins in exchanges compared to Bitcoins to get another leg up


Altcoins have also began to recover. This is after a capitulation-like correction. Bitcoin and Ethereum have also recovered. At 15:52 GMT on Monday, the pioneer cryptocurrency traded at $47,906. Just losing 1.45% in the last 24 hours. Ethereum also traded at around $1,800.

With the swift recovery of altcoins, and an abundance of stablecoins, it’s expected that Bitcoin rally will continue.

If you have any questions and comments on Bitcoin today, use the form below to reply.

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Published under: Bitcoin, Technical Analysis

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