- The continuous fluctuations in the market has led to a longer rate of liquidations in the market
- Due to such liquidations, the prices of crypto assets have fallen heavily
- Small-scale traders are now shifting to the technique of leverage
The ongoing volatility in cryptocurrency is not an unknown fact in the financial market. A constant selling off is going on in the market with a lot of ups and downs. A continuous set of tension is prevalent over the crypto market. Very recently, an amount of $4 billion was liquidated in a very short time frame, and also, an amount of $1 billion was liquidated today in a timespan of just an hour. This happened at a crypto selloff held today where the atmosphere was very intense, and people were grossly liquidating all their crypto assets which levelling up their Bitcoin dominance. The long positions amount to nearly 91% of the total liquidated positions, and 40% is covered and held by BTC. As per reports, an amount of nearly $5.77 billion has been liquidated by the asset holders, which is a huge leap and dynamic change in the market of digital currency.
The volatility in the prices over long liquidities
Presently the trading volume price of Bitcoin stands at $48,110, which rose from a value of $45,917 today morning. Removing and cutting down all the weekly gains, the price of BTC is still 21% below its highest margin and 13% below its previous amount. The highest margin of BTC stands at $58,641, which was after Tesla entered the blockchain. All other coins listed in the list of 10 faced a 10-11% decline in their regular prices, and the minute altcoins were blown down to 20%. However, with many ups and downs and with the continued dominance of BTC over all other asset companies, the cumulative rise in the crypto market was nearly 64%, which is even higher than yesterday, by a scale of 2%.
Traders Shifting to Leverage and Risking Their Assets
With BTC crashing the leaderboard’s high scores every week, all other crypto traders are feeling very much overshadowed and are comparatively getting less exposure to a marginal trade. Many common traders are unable to afford the position of being leveraged and are unable to cope up with the market. Due to all these fluctuations, the market has reached a position wherein many long liquidations are taking place. In the above context, leverage implies traders with an inability to produce larger funds, getting their funding from others in loans, and buying the required amount of asset as per the high market margins. This type of trading technique provides a stand to the traders to make huge profits; the potential to face losses is much higher.