ETFs
Wild Bitcoin (BTC) and Ether (ETH) Price Swings Amid One-Time Ethereum ETF Move Sparks $350M Crypto Liquidations
Crypto prices suffered wild swings on Thursday as traders eagerly awaited a US regulatory decision to list exchange-traded funds as cash.
In the agonizing hour before final approval, ETH first fell to $3,500 around the traditional US market closing time, then surged to nearly $3,900 as Early unconfirmed reports of approval ultimately appeared to settle above $3,800 following confirmation.
Bitcoin (BTC) saw an equally eventful episode drop to $66,000, then rise to $68,300 before paring gains below $68,000. However, ETH performed better, rising 1.5% over the past 24 hours, compared to a nearly 3% decline for BTC over the same period. The general CoinDesk 20 index fell 1.6% during the day.
Amid this volatile episode, liquidations of all leveraged crypto derivatives positions soared to over $350 million during the day, the highest since May 1. CoinGlass data watch.
Liquidations occur when an exchange closes a leveraged trading position due to a partial or complete loss of the trader’s initial money or “margin” – if the trader fails to meet margin requirements or does not have sufficient funds to keep the transaction open.
The lion’s share of positions wiped out were long bets on rising prices, worth about $250 million, suggesting that overleveraged traders were caught off guard by the sudden price drop. ETH traders were hit the hardest, with $132 million in liquidations, followed by $70 million in BTC derivatives liquidations.