Bitcoin, Ethereum, XRP, Solana Flash Crash Sinks $1.5 billion
Bitcoin posted sudden losses on Tuesday morning and sank below the $95K support line. The altcoin market followed suit with tremendous losses, including double-digit price declines from XRP, Solana, and Dodge.
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The cryptocurrency community speculated that the drop might be because of lower expectations for an alt season following Bitcoin’s breakthrough above the $100K mark.
CoinGlass data showed the total value of positions wrecked in the last 24 hours increased to almost $1.5 billion. The single-biggest position destroyed was worth $20 million and involved ETH.
The massive liquidations were caused by profit-taking, large sell orders at significant milestones, and overleveraged positions. Since many traders relied on borrowed money to place bets on Bitcoin’s continued growth, they were vulnerable when prices dropped.
Bitcoin went on the offensive in the early hours of Monday and jumped above $100,000 after its most recent price rejection at the coveted $100,000 mark, sending the asset south hard and dumping by roughly 6K. That was temporary, though, as the asset fell below it almost instantly. It lost several thousand dollars and leveled off at $98,000, but just minutes ago, the bears were able to seize total control of the market and send it plunging.
The price of Bitcoin fell by $4K in about an hour and plunged to a multi-day low of $94,300 (on Binance). , the situation is concerning for overly leveraged traders despite its quick recovery and current position near $97,000
However, data from Ki Young Ju, CEO of CryptoQuant, indicated that, given the increase in stablecoin liquidity in the market, the earlier altcoin rally did not come at the expense of Bitcoin.
This implies that fresh money entered the market to support the rally Instead of capital rotating from Bitcoin. This has raised hopes among cryptocurrency enthusiasts, who hypothesized that the correction is a brief reversal intended to propel the altcoin market capitalization to all-time highs.
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