85,000 crypto traders ‘liquidated’ after Bitcoin fell to nearly $30,000

The cryptocurrency market has been a wild ride since the advent of Bitcoin and the advent of the blockchain (the technology that powers cryptocurrencies). Bitcoin gained more than 6,000% in value between 2016 and 2017, and it has been an astonishingly volatile time in the crypto space. In a recent report, “Coinmarketcap”, a website that tracks all the cryptocurrencies in the market, estimates that more than 85,000 traders have been “liquidated” since the beginning of the year.

Bitcoin’s recent drop has been a cause for concern for the crypto market, and the first of many bad days. The price of Bitcoin dropped below the $7,500 mark, the lowest since November 2017. The market moves are extreme for the market, with Bitcoin’s price falling to almost $3,000. But worry not, the crypto traders will not be “liquidated”, they will not even be thrown out of their apartments.

Tens of thousands of crypto traders were liquidated last night when bitcoin briefly dipped below $30,500, multiple sources reveal. Altcoins have suffered a similar setback, depreciating millions of dollars in little-known coins like AXIE and SAND.

More than 82,000 traders were liquidated, with the largest liquidation order being issued to the Bybit exchange – the bitcoin transaction was worth $4.86 million.

Liquidation and as

Liquidation, for the uninitiated, occurs when leveraged positions are automatically closed by exchanges/brokers as a safety mechanism. Futures and margin traders, who borrow capital from exchanges (usually several) to make large bets, pay a small deposit before making a trade.

Bitcoin traders did most of these liquidations yesterday. Bitcoin transactions were liquidated for $146.14 million, followed by Ethereum ($52 million), XRP ($8 million) and Axie Infinity ($5 million), according to analysis tool Bybt.

Image : Liquidation details via Bybt.

Traders betting on the dogecoin Memecoin suffered a liquidation loss of $5 million, while traders on Sandbox NFT (SAND) and Chromia (CHR) suffered losses of $2.59 million and $2.38 million, respectively.

Where did the liquidation take place?

More than $100 million was liquidated in the Bybit futures market alone, with 83% of all traders placing long bets on rising prices in this market. OKEx liquidated $63 million, while Binance liquidated $23 million.

Meanwhile, despite the million-dollar loss, these figures are nothing compared to those recorded several times at the beginning of the year. In April 2021, after bitcoin peaked and fell off a cliff, a staggering $1 billion liquidation took place in the market, involving a million trading accounts.

Then, in June, renewed criticism of bitcoin from China led market volatility to the liquidation of 200,000 traders. A number of major cryptocurrencies like Solana, XRP, and Polkadot saw double-digit declines, and even Dogecoin wound up with $30 million in a single day.

What seems like madness in traditional circles nevertheless remains a normal day for those involved in cryptocurrencies.

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