A dramatic liquidity crisis unfolded this morning as Bitcoin‘s price surged to $94,150, only to plummet shortly thereafter. This abrupt fall led to the liquidation of nearly $900 million in positions within moments, echoing a previous spike at $90,500, while altcoins managed to avoid similar substantial losses.
What Caused the Cryptocurrency Liquidation?
Over the past day, approximately $1.5 billion in long positions were forcibly liquidated across the cryptocurrency market. Ethereum experienced the most significant losses, with $250 million liquidated, outpacing Bitcoin’s figures. The rapid drop from over $4,000 to around $3,400, despite not being heavily leveraged, negatively affected those with long-term holdings.
Are Altcoins Facing Similar Challenges?
Several altcoins, including SOL, DOGE, and XRP, faced liquidations ranging from $59 million to $23.3 million. In the last 24 hours, other currencies like POPCAT and IOTA experienced declines exceeding 18%. The fear and greed index reflected this downturn, falling about 10 points to a reading of 76.
Key observations from the recent market shifts include:
- Bitcoin’s market dominance has risen to 55.6%.
- Trading volumes reached nearly $350 billion, marking a 100% increase in a day.
- Shiba Coin saw a drastic 25% drop before slightly recovering.
The current volatility in the market, especially following Bitcoin’s record high above $104,000, raises concerns as traders brace for the upcoming U.S. inflation report and the Federal Reserve’s interest rate decisions scheduled for December 18. This climate of uncertainty could lead to further fluctuations in the cryptocurrency landscape.