The crypto market saw the highest amount of liquidations so far this month.
Liquidations on crypto-tracked futures exceeded $400 million in the past 24 hours as bitcoin (BTC) dropped to as low as $35,700, setting the tone for a downturn in the broader crypto market.
Bitcoin futures racked up $191 million in losses alone, Coinglass data shows, suggesting most trading activity and open interest was limited to the largest cryptocurrency by market capitalization. Ether (ETH) futures followed with $64 million in losses.
Liquidations occur when an exchange closes a leveraged position as a safety mechanism due to a partial or total loss of the trader’s initial margin. That happens primarily in futures trading, which only tracks asset prices, as opposed to spot trading, where traders own the actual assets.
Bitcoin fell from $39,800 on Thursday morning to below the $36,000 support level following a sell-off in U.S. equities. Reports suggested the plunge came as traders priced in higher rates to curb inflation in the U.S., despite a rally on Wednesday after Federal Reserve Chair Jerome Powell said the country would do everything in its power to curb inflation.
Crypto majors showed relatively lower losses. Futures tracking Solana’s SOL saw $9 million in losses, followed by Terra’s LUNA at $6.7 million. This was despite the two tokens losing as much as 10% in the past 24 hours – suggesting the sell-off was led by spot assets.
Among other alternative currencies, ApeCoin (APE) futures saw the most losses at $11 million, followed by Stepn (GMT) at $10.36 million. Dogecoin (DOGE) futures lost $4.56 million after underperforming the market on Thursday.
Over $161 million in liquidations occurred on OKX, the most among crypto exchanges. Binance followed with $104 million while FTX saw $56 million, the data showed.