Bitcoin price collapsed, nearly 1 billion USD of 250,000 investors was liquidated

Bitcoin price collapsed, nearly 1 billion USD of 250,000 investors was liquidated Picture 1

On April 14, BTC dropped sharply to about 62,000 USD, according to CoinMarketCap data . The previous days, the world's largest digital currency was trading at around 67,000 USD. Bitcoin's major collapse occurred at a time when the community expressed optimism and confidence in the price increase, with the sentiment index at 'Greed'.

The sharp drop in price of BTC quickly affected the futures market. According to CoinGlass data , about 257,000 traders had their orders liquidated. The total value of assets lost on the exchanges is about 960 million USD.

In particular, the losses were concentrated in investors who placed orders predicting an increase (Long), with a total liquidation of 770 million USD. The largest order whose account was 'burned' was 8.5 million USD, on Binance. Bitcoin ranks first among the most liquidated assets. The remaining positions belong to Ethereum, Solana, Dogecoin, BNB.

This form of investment in the futures market has many potential risks, especially with highly volatile assets like cryptocurrency. Participants of this type often use various types of leverage, with large ratios. This makes the investment easy to liquidate when asset prices fluctuate. For new investors, who do not clearly understand the process of placing orders and cutting losses, it can lead to huge losses.

According to CoinDesk , the cryptocurrency market is affected by risks appearing in the investment industry, as political tensions escalate. Bitcoin's decline occurred amid the red covering US stocks. Treasury bonds and the USD index (DXY) surged as traders rushed to buy the asset, hedging risks. Gold, a safe haven asset, has surpassed $2,400. Crude oil prices also increased more than 1%.

Forecasts for Bitcoin in the short term are not too positive, when the CPI consumer price index that the FED just announced remains high. This may cause the interest rate reduction process to be adjusted. At the same time, political and macroeconomic fluctuations can affect risky investment types such as cryptocurrency.

David Pac

Update 14 April 2024