Bitcoin falls below $54,000 as derivatives positions worth over $1 billion get liquidated

Feb 22, 2021 | The Block News | 0 comments

bitcoin-falls-below-$54,000-as-derivatives-positions-worth-over-$1-billion-get-liquidated

The price of bitcoin has fallen below $54,000 from nearly $58,500 on Sunday as derivatives positions worth more than $1 billion get force liquidated by crypto exchanges.

About $1.33 billion worth of open interest was liquidated by crypto exchanges in the last 24 hours, according to tracker Bybt.com. In other words, crypto exchanges liquidated traders’ overleveraged positions. 

Traders overleverage, or trade on margin, thinking that bitcoin’s price would go up and they would benefit more. But when bitcoin’s price goes below the liquidation price of their positions, exchanges force liquidate or close their positions because traders cannot fulfill margin requirements of their leveraged positions.

“In the past weeks, a lot of accumulation on the long side happened, so traders should expect such correction events,” Bitfinex CTO Paolo Ardoino told The Block, adding that such corrections are “normal.”

Most of the liquidations occurred on Binance, followed by Huobi and Bybit. While in terms of crypto assets, bitcoin positions formed most liquidations, followed by ether (ETH) and XRP. 

Bitcoin is currently trading at around $53,400, according to tracker TradingView. Meanwhile, ET is trading at about $1,775.

© 2021 The Block Crypto, Inc. All Rights Reserved. This article is provided for informational purposes only. It is not offered or intended to be used as legal, tax, investment, financial, or other advice.

News Source from TheBlockCrypto.com

Related Articles

Cboe Applies to List First Bitcoin ETF in US

Cboe Applies to List First Bitcoin ETF in US

In the closing days of 2020, investment firm VanEck filed an application with the US Securities and Exchange Commission (SEC) to form the VanEck Bitcoin Trust, an exchange-traded fund (ETF). Equities market operator Cboe BZX Exchange has now filed a proposal with the...

Ethereum mining revenue breaks $1 billion for the first time in February

Ethereum mining revenue breaks $1 billion for the first time in February

Total Ethereum mining revenue reached $1.37 billion in February — a new record, according to data from The Block.  Ethereum mining revenue grew 65.1% between January and February. During that time, transaction fees grew 122.1%. Ethereum mining revenue often features a...

Mark Cuban’s Shark Tank Co-Host Mr. Wonderful Pulls 180 on Bitcoin

Mark Cuban’s Shark Tank Co-Host Mr. Wonderful Pulls 180 on Bitcoin

First, Mark Cuban got into Ethereum. Now his Shark Tank co-host has announced his arrival to Bitcoin. Canadian businessman Kevin O’Leary, known to fans of the investor reality show as “Mr. Wonderful,” said today he will invest 3% of his portfolio in Bitcoin despite...

Pin It on Pinterest

Share This