Crypto Carnage: Over $800 Million Wiped Out In Market Plunge

The recent market crash has sent shockwaves through the crypto industry, causing hundreds of millions of dollars to disappear in a matter of hours.

Bitcoin price has retreated violently to a weekly low of $67,500 after a few days of showing notable gains and setting new all-time highs.

Altcoins have also seen a significant drop, causing nearly 200,000 traders to liquidate over the past 24 hours.

The weekend brought a tremor to the cryptocurrency market, with a sudden price correction causing short-term panic and hundreds of millions in liquidated positions.

However, despite the swing, analysts are divided on whether this means a broader market shift or a simple blip on the bullish radar.

Crypto Long Squeeze Triggers Liquidations

During a 24-hour period ending on Friday, March 15, the global cryptocurrency market capitalization lost a fantastic 6%. This triggered a wave of automated liquidations, particularly for investors holding leveraged long positions (essentially large bets on rising prices).

According to Coinglass, a crypto data analytics platform, long positions worth over $800 million were liquidated across the market. Bitcoin itself suffered the brunt of the selling pressure, falling to $67,000, its lowest point in more than a week.

The pain was not evenly distributed. More than a third of the liquidations, a total of $660 million, came from long positions in Bitcoin.

Altcoin Bloodbath Follows Bitcoin's Lead

The tremors were not limited to Bitcoin. The correction spread to the altcoin market, with popular tokens such as Cardano, Dogecoin, Shiba Inu, and XRP experiencing significant price drops.

This, in turn, triggered further liquidations of long positions held in these altcoins. XRP traders alone saw more than $10 million liquidated, of which almost $11 million came from long positions.

Crypto Market Strikes Back: Buy the Dip

Despite the scare of the week, the overall sentiment in the cryptocurrency market remains surprisingly optimistic. This is mainly due to the rapid buying activity seen at key support levels as prices moved lower.

Bitcoin, the world's most sought-after crypto asset, for example, has already seen a partial recovery, recovering to just over $69,000 at the time of writing.

Similar bounces have been observed in several altcoins, suggesting that investors could be viewing this as a buying opportunity.

This correction can be seen as a healthy market reset after a strong rally, some analysts say. While some leveraged positions were burned, the fact that investors are stepping in to buy the dip indicates continued confidence in the long-term potential of cryptocurrencies.A continuous balancing act

The weekend's events serve as a microcosm of the current struggle within the cryptocurrency market. On the one hand, there is a growing sense of institutional adoption and widespread acceptance, fueling bullish sentiment.

On the other hand, the inherent volatility of cryptoassets continues to pose a challenge, with sudden price swings capable of inflicting significant losses on unsuspecting investors.

Featured image from Pexels, chart from TradingView

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