Bitcoin Drops to $29,000 in Sudden Sell-Off; Longs Are 98% of Over $160M in Crypto Liquidations
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President and CEOFranklin Templeton
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Shaurya is the Deputy Managing Editor for the Data & Tokens team, focusing on decentralized finance, markets, on-chain data, and governance across all major and minor blockchains.
Featured SpeakerJenny Johnson
President and CEOFranklin Templeton
Jenny will discuss developing crypto-linked investment products in a bear market, the mood among her clients and her lon…
Bitcoin (BTC) slid more than 3% in just 15 minutes in European morning hours on Wednesday, taking the largest cryptocurrency by market capitalization below $30,000. Further declines took it as low as $29,000, CoinDesk data shows.
While the sell-off did not appear to stem from any immediate fundamental reason, an unexpectedly high U.K. March inflation figure of more than 10% may have influenced market sentiment. Also in the mix: A so-called long squeeze. More than $25 million in bitcoin futures were liquidated – of which longs, or bets on rising prices, made 98% of the positions.
“The hotter-than-expected U.K. CPI may have weighed over risk assets, including BTC. But the gravity of the reaction has been far far more severe than in other asset classes,” Vetle Lunde, a senior analyst at K33 Research, told CoinDesk.
“Seems to be more of an leverage wash out. Binance OI in BTCUSDT perps fell 5.1% in 15 minutes, effects more severe in ETH with larger liquidation volume than BTC,” Lunde said, referring to open interest, or the total number of contracts in the futures market.
Liquidation refers to when an exchange forcefully closes a trader’s leveraged position due to a partial or total loss of their initial margin. It happens when the investor is unable to meet the margin requirements for a leveraged position, they don’t have sufficient funds to keep the trade open.
Large liquidations can signal the local top or bottom of a steep price move, which may allow traders to position themselves accordingly.
The slide led to a sell-off in the broader crypto market, with Ether (ETH), polygon (MATIC) and dogecoin (DOGE) falling 5.3% in the past 24 hours and solana (SOL) losing nearly 9%.
UPDATE (April 19, 09:10 UTC): Rewrites headline; adds analyst comment in third paragraph, U.K. inflation, wider market in last paragraph.
Edited by Sheldon Reback.
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Shaurya is the Deputy Managing Editor for the Data & Tokens team, focusing on decentralized finance, markets, on-chain data, and governance across all major and minor blockchains.
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Shaurya is the Deputy Managing Editor for the Data & Tokens team, focusing on decentralized finance, markets, on-chain data, and governance across all major and minor blockchains.
