Data shows the cryptocurrency derivatives market has seen a huge amount of liquidations following Bitcoin’s surge to a new all-time high (ATH).
Bitcoin Has Rallied To A New Price Record
After prolonged consolidation just under the ATH, Bitcoin has finally broken through to set a new record. Although brief, BTC’s move saw it touch the $112,000 mark.
Below is a chart that shows how the asset’s recent performance has been like:
The price of the coin appears to have shot up over the last 24 hours | Source: BTCUSDT on TradingView
As is visible in the graph, Bitcoin has seen a small retracement to $111,000 since the ATH-setting surge. In typical fashion, this move from the original digital asset has sent a bullish wave across the sector, with altcoins observing jumps of their own.
Many of them have outperformed BTC, including Ethereum (ETH), which has seen a profit of around 4.5% during the past day. A notable performer among the top coins has been Sui (SUI), observing a rise of over 9% in this window.
With the bullish price action in the sector, the investors betting on a bearish outcome over at the derivatives side have naturally been dealt a blow.
Crypto Market Liquidations Have Crossed $500 Million
According to data from CoinGlass, the derivatives exchanges have registered significant liquidations over the last 24 hours. Below is a table showcasing the relevant numbers.
Looks like the liquidations have heavily tended towards short positions | Source: CoinGlass
In total, the cryptocurrency market as a whole has faced liquidations of almost $528 million in this period. Out of these, $453 million in liquidations, representing 85% of the total, came from the short investors alone.
In terms of the individual symbols, Bitcoin and Ethereum contributed the most toward the squeeze, with $225 million and $148 million in liquidations, respectively.
The breakdown of the liquidations by symbol | Source: CoinGlass
Mass liquidation events like this latest one aren’t a particularly rare sight in the cryptocurrency sector, due to coins being relatively volatile and extreme amounts of leverage being easily accessible.
There have been a couple of major short squeezes during the last few weeks alone. According to the analytics firm Glassnode, however, the latest event has seen different behavior in the Open Interest. The “Open Interest” is an indicator that keeps track of the total amount of positions related to Bitcoin that are currently open on all centralized derivatives platforms.
When mass liquidation events happen, it’s not unusual to see the Open Interest drop as investors get liquidated or exit the market. This happened with the last two short squeezes and also the latest one.
The trend in the BTC Open Interest over the last few weeks | Source: Glassnode on X
It’s apparent from the chart, though, that while Open Interest remained down after the previous rallies, it quickly bounced back up following the initial drop during the latest one. This trend could point toward fresh long positioning occurring in the sector.
Featured image from Dall-E, CoinGlass.com, chart from TradingView.com
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