Aug 18, 2023

$1 Billion Liquidations Trigger Crypto Bloodbath

Crypto Market Experiences a Bloodbath The Bitcoin (BTC) and Ether (ETH) price slump on Aug. 18 saw the top two cryptocurrencies fall to a 2-month low, triggering a series of liquidations for thousands of derivative traders. This crypto bloodbath caused billions of dollars in hedged positions to be liquidated and left several traders with millions…

Crypto Bloodbath: $1B in Liquidations with Bitcoin, Ether, Cardano, Solana, Polygon, Shiba Inu, Crypto.com, Ada, Avalanche, and Blur.
Bitcoin, Ether price slump leads to crypto bloodbath with $1B in liquidations

Crypto Market Experiences a Bloodbath

The Bitcoin (BTC) and Ether (ETH) price slump on Aug. 18 saw the top two cryptocurrencies fall to a 2-month low, triggering a series of liquidations for thousands of derivative traders. This crypto bloodbath caused billions of dollars in hedged positions to be liquidated and left several traders with millions of dollars in losses.

According to Coinglass data, 176,752 traders were liquidated over the past 24 hours, with 90% of those liquidations occurring in the last 12 hours. This sudden surge in volatility comes just days after BTC and ETH recorded their lowest daily volatility in several years.

Among the traders who lost a significant portion of their derivative positions, two particular liquidations stood out due to their immense scale. During the price slump, an investor on Binance’s ETHBUSD contract was liquidated at $1,434.37, resulting in a loss of $55.9211 million, making it the largest liquidation of the day. Another Binance trader on the BTCUSDT contract lost nearly $10 million in liquidations.

The crypto market experienced a major downturn, with the likes of Shiba Inu (SHIB), Polygon (MATIC), Solana (SOL), Crypto.com (CRO), Avalanche (AVAX) and Cardano (ADA) all experiencing losses.

Crypto Liquidation Event

The billion-dollar liquidation is the biggest liquidation event in crypto in the past 8 months, since the last such event during the FTX collapse.

The price function in the crypto market was attributed to several factors including the SpaceX Bitcoin write down, the macroeconomics, where BTC and ETH have been trading in a range for the past couple of months.

BTC held onto the key $28,000 support for a couple of months while ETH held the $1,500 support before giving in yesterday. The liquidity in the crypto market has been on the lower side, and prominent crypto exchanges such as Coinbase had seen a significant decline in their trading volume.

Crypto Market Overview

The billion-dollar liquidation event is the largest of its kind in crypto during the past 8 months, since the prior liquidation event that occurred during the FTX collapse.

The crypto market’s price movements have been attributed to a variety of factors, including the SpaceX Bitcoin write down and the macroeconomics, where BTC and ETH have been trading within a range for the past few months.

BTC managed to hold onto the key $28,000 support for a couple of months, while ETH held the $1,500 support before succumbing yesterday. The crypto market’s liquidity has been on the lower side, and popular crypto exchanges such as Crypto.com, Coinbase, Shiba Inu, Solana, Polygon, Avalanche, and Cardano have all seen a significant decline in their trading volume.

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