The recent dip in Bitcoin's price has led to over $305 million in liquidations across crypto derivatives exchanges. Bitcoin fell below the $57,000 mark on July 4, reaching a low of $56,769 per unit. Despite several attempts to regain stability, it continues to struggle to maintain the $57,000 level.
Neil Roarty, an analyst at Stocklytics, highlighted that this drop in price is the lowest Bitcoin has reached since February. He attributed investor concerns to two potential large-scale sellers: the German government and the bankrupt crypto exchange Mt Gox. Roarty warned that if an additional 200,000 bitcoins, valued at over $10 billion, flood the market, supply will exceed demand and further drive down the price.
QCP Capital, another crypto firm, also acknowledged the downturn on Thursday. They noted that Bitcoin miners are showing signs of capitulation, which historically indicates price bottoms, similar to the significant hashrate drawdown in 2022 when Bitcoin traded at $17,000. However, QCP Capital highlighted the optimism in the options market, particularly for Ethereum, with heavy interest in Ethereum calls for September and December expiries. They also mentioned the potential for short squeezes due to heavily skewed liquidation clusters on BTC and ETH.
During this market decline, crypto derivatives exchanges witnessed liquidations totaling $305.43 million. The majority of these liquidations were from long positions, with $92.6 million coming from Bitcoin long positions. Coinglass.com reported that approximately 121,992 traders faced liquidations, with the largest loss being $10.49 million from a BTC trade.
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