Bitcoin suddenly reversed course on Wednesday, with the BTC price tanking to as low as $29,014 in the span of a few hours. Futures traders betting on a continued uptrend of crypto prices racked up over $241 million in losses to liquidations.
Long Liquidations Top $241 Million
Bitcoin dived by around 3.6% to just over $29K on April 19, reaching levels not seen since April 10.
Similarly, the total market capitalization of all cryptos fell by circa 3.4% over the past 24 hours to $1.28 trillion, according to CoinGecko. Ethereum, the second-largest cryptocurrency by market value, also lost its $2,000 crucial support level and is currently down 6.2% in the last 24 hours, changing hands at $1,984.62.
“Deep correction on the markets, as Bitcoin can’t hold at $29,700-29,800 and shoots downwards through a cascade of liquidations,“ crypto analyst Michaël van de Poppe observed.
Specifically, the abrupt price retracement caused a total of $241.37M in liquidations across the cryptocurrency market, data from Coinglass shows. Of the liquidated trading positions over the last 24 hours, the majority were longs, betting on higher prices. Ether (ETH) traders suffered the most losses, some $59.03 million, while Bitcoin (BTC) liquidations surpassed $47.51 million.
Traders on Binance, the world’s largest crypto exchange by trading volume, saw $5.75 million of losses, followed by $3.11 million of losses on OKX, and $2.30 million on Bybit, per CoinGlass. Binance also saw the highest liquidated value, with a single $3.02 million Bitcoin position getting closed on the exchange.
What Triggered The Sudden Bitcoin Price Drop?
While there were no direct catalysts to explain the meltdown, the bitcoin price drop comes as global equity markets slipped after the Bank of England and the European Central Bank said they were considering hiking interest rates further to bring inflation under target rates. The U.S. Federal Reserve has also recently hinted at another rate increase in the upcoming May policy rate meeting.
Following the sharp decline in the bitcoin price today, traders have become more cautious about the market’s short-term trend. Others, like trader Crypto Kaleo, however, called the correction “beautiful” while reminding his followers that “dips are gifts”.