Bitcoin

BitMEX: Bitcoin’s plunge triggers liquidations worth nearly $250 million

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Source: Pixabay

Less than two days before the halving, Bitcoin’s frenetic volatility propelled a drop to $8,534 in just a few hours all the way from $9,581 wiping out a major portion of the gains made over the past couple of weeks. The quick dive close to the critical support at $8.5K was accompanied by liquidations worth $250 million, according to data from the crypto analytic platform.

Source: Skew

While both long and short positions have been liquidated, however, it was the long positions that witnessed unprecedented liquidation on the Seychelles-based crypto exchange BitMEX. According to Datamish, longs liquidated were$247.636 million while that of shorts stood at $808 K.

Source: Datamish

Notably, this has been the largest long squeeze since the crash on the 12th of March when Bitcoin’s flash crash caught the traders off guard and triggered more than $700 million worth liquidation. During the time, the price of Bitcoin tumbled all the way down to $4,300. It posted recovery since then and despite numerous pullbacks, it briefly topped over $10,000.

Source: Skew

At the time of writing, the price seemed to be gradually rising and was up by 1.28% over the last two hours. Despite this, the latest plunge caused a Bitcoin’s at-the-money [ATM] implied volatility shot up from 81% to all the way up to 95%. A rise in volatility often has a positive effect on the price of the options which gives rise to stronger hedging demand for call and put options, this pointed towards the traders anticipating Bitcoin’s volatility to remain inflated in the coming days.

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