In the last few days, there have been big changes in crypto land. In just 24 hours, more than $550 million was liquidated. When Bitcoin fell to its weekly low, it caused a flood of sell-offs that caused about 170,000 traders to lose money on their accounts.
Coinglass reports such tremendous losses to be placed at $118 million in BTC longs, $54 million in ETH longs, and even $25 million in Dogecoin long positions.
This surge in liquidations, in conjunction with a decrease in market capitalization and trading volume, emphasizes the volatility that traders have come to anticipate. This is perceived by analysts as a component of a more extensive pattern of corrections that have occurred in the wake of Bitcoin’s recent rally to near-record levels.
Bitcoin Dominance & Liquidation Trends
Bitcoin’s dominance remains robust, with a current market capitalization of $3.23 trillion, which accounts for over 56% of the total crypto market. The highest liquidation of the day was a $4.67 million BTC/USDT exchange on Binance, which is indicative of the high stakes involved in leveraged trading.
Additionally, altcoins were not spared. Significant declines were observed in tokens with a smaller market capitalization, with the broader market losing approximately $100 million.
Some analysts think this is just another usual correction, following the hefty close to 44% rise in Bitcoin price since early November. At present, the crypto Fear and Greed Index stands at 82, suggesting that the prevailing dominance in the market is still “Extreme Greed.”
Ethereum And Altcoins Maintain Their Poise
Ethereum remains resilient, despite the fact that it was not spared from the day’s losses. The uncertain sentiment surrounding the second-largest cryptocurrency was underscored by a combination of long and short liquidations in ETH positions.
In the interim, altcoins such as Dogecoin, which were frequently bolstered by meme-driven enthusiasm, experienced the repercussions of market corrections, a warning to traders who were seeking rapid profits.
An industry analyst named Miles Deutscher noticed that more traders are reactivating their wallets after not using them for months. They are doing this because they are interested in the possibility of altcoins and Bitcoin’s strong performance. As the market continues to follow its usual trends, this increase in activity could lead to both growth and volatility.
The Road Ahead For Bitcoin
At $92,801, Bitcoin still lags somewhat behind its all-time high of $99,750, attained earlier this month. The next action divides analysts; some believe the market is ready for consolidation prior to another surge beyond $100,000. Others caution that overlevers may cause short-term greater volatility.
Investors are keenly monitoring market mood and macroeconomic factors. Although current conditions may promote bullish momentum, the crypto market’s severe price volatility and huge leverage risks remind us of its unpredictable nature.
Featured image from DALL-E, chart from TradingView
