TL;DR
- Massive liquidations on exchanges like Binance have driven a sharp drop in Bitcoin and other altcoin prices.
- Bitcoin ended below $65,600, while Ethereum touched lows of around $3,300 due to high funding rates and decreasing risk rates.
- In the last 24 hours, leveraged positions totaling $394 million have been liquidated, with the largest liquidation on the ETH/USD pair on OKX, affecting over 120,000 investors.
The crypto market is experiencing a very tumultuous day; the latest sudden movement in Bitcoin and other altcoin prices has left many investors wondering what could have caused this sharp drop. This time, analysts at QCP Capital have pointed out that massive liquidations on exchanges, especially those with a large number of retail users, like Binance, have been the main driver behind this market correction.
The drop in Bitcoin and Ethereum prices has been significant, with BTC ending below $65,800, having lost 6% of its value, and ETH touching lows of around $3,300 after a 6.8% decline.
According to analysts at QCP Capital, this rapid decline has largely been due to massive liquidations on exchanges, leading to an increase in funding rates, which have reached extremely high levels. These rates, along with the downward trend in risk rates, have provided early signals of a downward movement in the crypto market.
Bitcoin May Find Balance After Price Correction
In the last 24 hours, leveraged positions worth a total of $394 million have been liquidated, with $312 million corresponding to long positions and $81 million to short positions. This has affected over 120,000 investors worldwide. The largest liquidation occurred on the ETH/USD pair on OKX.
Following the movement of other altcoins, BNB fell by 5.2% and is trading at $555. Solana (SOL) experienced a stronger decline, with an 8.2% drop, bringing its current value to $179.8. Meanwhile, Avalanche (AVAX) dropped to $47.11 after a 10% reduction. It is closely followed by Cardano (ADA), which lost 10.5% and is trading at $0.1842. Lastly, XRP was less affected, with a 3.5% loss, leaving it around $0.5882.
After this price correction in the market, some analysts speculate on whether it could be the moment that finally balances the market, which had experienced days of volatility, mainly in Bitcoin. As funding rates stabilize and the market adjusts to the new conditions, opportunities will emerge to implement specific trading strategies that benefit from a market with a stable price range.
