Bitcoin’s Price Drop Causes Over $200 Million in Long Liquidations Across Crypto Derivative Exchanges – Bitcoin News
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Bitcoin’s Price Drop Causes Over $200 Million in Long Liquidations Across Crypto Derivative Exchanges – Bitcoin News
Bitcoin, the world’s most popular cryptocurrency, experienced a sudden decline in value on September 7, 2021. The drop in price caused investors to lose more than $200 million in long liquidations across various crypto derivative exchanges.
Long liquidations occur when traders with open long positions are forced to close them due to the market price movement. In this scenario, the market price of Bitcoin suddenly dropped, leading to a cascading effect of liquidations across several cryptocurrency exchanges.
The massive liquidations first started at around 4:45 UTC on September 7, and continued for several hours, leading to an almost 17% drop in Bitcoin’s price. At the time of writing, Bitcoin is trading at around $44,000, which is significantly lower than the $52,000 value it was trading at just two days ago.
Several factors could have caused this sudden drop in the market. One possible explanation is the growing regulatory scrutiny around the cryptocurrency industry, particularly with regards to China’s ongoing crackdown on mining operations and trading activities. Additionally, concerns around the upcoming meeting of the US Federal Reserve’s monetary policy could also have contributed to the market’s decline.
Despite the market’s volatility, Bitcoin has been experiencing surging interest from institutional investors, with several large corporations and financial institutions investing in the cryptocurrency. In fact, El Salvador recently became the first country in the world to officially adopt Bitcoin as legal tender.
The long liquidations caused by the sudden price drop highlights the risks associated with trading cryptocurrency, particularly for those who invest in derivatives. Investors need to be aware of the significant risks of investing in such digital assets, as the volatility of the market can lead to significant losses.
Overall, the recent drop in Bitcoin’s price serves as a reminder that the cryptocurrency market is still highly volatile and unpredictable. It is crucial for investors to exercise caution and ensure that they are aware of the significant risks involved before investing in cryptocurrencies.
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