Bitcoin plummets below $63,000, wiping out $533 million in long contracts

Bitcoin, the flagship cryptocurrency, has experienced a significant downturn, plunging below the $63,000 mark, shedding more than 15% of its value since reaching an all-time high (ATH) of over $73,800.

In the past 24 hours, Bitcoin’s price has dropped by over 7%, marking a stark reversal from its recent bullish momentum. The cryptocurrency’s latest drawdown has rattled investors, triggering a cascade of liquidations in the derivatives market.

Derivatives market rattles amidst Bitcoin’s bearish turn

The derivative side of the cryptocurrency market has witnessed a flurry of activity as Bitcoin’s price plummeted. Liquidations, where contracts incur losses beyond a specific threshold, have surged across various exchanges.

CoinGlass data reveals that approximately $657 million worth of cryptocurrency derivative contracts have been liquidated within the last day, with long positions bearing the brunt of the losses.

Long contracts bear the brunt as Bitcoin tanks

The majority of liquidations, totaling $533 million, have been long positions, signaling a prevailing sentiment of optimism swiftly challenged by Bitcoin’s downward spiral. In contrast, short positions saw a comparatively modest $123 million liquidation.

Among individual cryptocurrencies, Bitcoin and Ethereum have dominated the liquidation charts. Bitcoin saw $191 million in contracts liquidated, while Ethereum trailed closely behind with $134 million wiped out.

While Bitcoin and Ethereum faced substantial liquidations, altcoins have also felt the sting of the market downturn. Solana (SOL) and Dogecoin (DOGE) stood out with liquidations totaling $39 million and $14 million, respectively. Their sharper declines compared to other altcoins contributed to the significant liquidation figures.

Open interest indicates continued volatility

The “Open Interest,” measuring the total number of BTC-related contracts in the derivative market, remains a key metric indicating potential volatility. With high Open Interest levels, the cryptocurrency market is prone to sharp price movements, suggesting that further turbulence may persist until this indicator stabilizes.

As Bitcoin’s price fluctuates, uncertainty looms over the cryptocurrency market. The recent cascade of liquidations underscores the inherent volatility and risk of trading cryptocurrencies. Investors brace themselves for continued turbulence as they navigate the ever-changing landscape of digital assets.