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The volatility in the crypto market has triggered an increase in the liquidation of futures crypto positions, and in the early hours of March 19, the price of Bitcoin fell below the $64,000 level. The value of the largest cryptocurrency by market capitalization dropped by 5.49% in the last 24 hours at the time of writing, trading at $63,964.
Liquidation Process and Futures Market
The recent price correction led to a significant liquidation of long positions in the futures markets of centralized exchanges. According to data from the blockchain data analysis platform CoinGlass, this volatility resulted in the liquidation of more than $162 million in Bitcoin positions, the majority of which were long positions, amounting to $134 million.
Ethereum, the second-largest cryptocurrency, also experienced a 9.5% drop the previous day and was trading at $3,279 at the time of writing. According to Tradingview data, the recently popular altcoin project Solana took a harder hit with a drop of over 12%.
Data indicates that the overall crypto market witnessed the liquidation of over $515 million in long positions in the last 24 hours, contributing to a total liquidation of $620 million across various centralized exchanges. Liquidations occur when an investor’s position is forcibly closed due to a lack of funds to cover losses. This situation happens when market movements are unfavorable for the investor’s position, leading to the depletion of their initial margin or collateral.
What’s Happening on the Crypto Front?
Recently, expected halving events on the Bitcoin front and particularly sales of Bitcoin in Grayscale’s ETF fund have caused the price to fall. The crypto market, which has faced one of the largest price corrections in recent times led by Bitcoin, also took a significant hit last week with the announcement of CPI data in the US, reducing the likelihood of interest rate cuts.
During this period, crypto analysts frequently mention that such corrections are positive for market health. The halving event, which is only a month away, and the Bitcoin sales on the GBTC front may continue to affect the crypto market.
