Bitcoin’s price took a sharp nosedive, plummeting below $69,000 in a flash crash that left a trail of destruction in the crypto market. While there has been a slight recovery since then, the damage has already been done. Thousands of traders found themselves on the wrong side of the trade as leverage positions were liquidated, resulting in significant losses.
In the aftermath of the flash crash, over 81,000 traders saw their leveraged positions liquidated, with a total of $223 million lost in just a short period of time. The largest liquidation occurred on the OKX exchange, where a trader lost $7 million in a single swoop. Long traders bore the brunt of the losses, accounting for over 70% of the liquidated positions. Long liquidation volumes reached over $156 million within a 24-hour period.
The majority of liquidations took place on the OKX exchange, followed by Binance and Bybit. OKX accounted for nearly half of all liquidations, with Binance coming in second and Bybit in third place. These exchanges witnessed millions of dollars in liquidation volumes, reflecting the widespread impact of the flash crash across the market.
While Bitcoin and Ethereum saw the largest liquidation volumes, meme coins such as Dogecoin and PEPE also experienced significant losses. Dogecoin’s liquidation volumes surpassed $10 million, outpacing other major altcoins like Solana. This highlights the vulnerability of not just major cryptocurrencies, but also smaller and lesser-known coins in times of market volatility.
Long traders continue to face substantial losses, with the trend showing a bleak outlook for their positions. Data from Coinglass reveals that long traders accounted for the majority of liquidations across different timeframes, indicating the challenges they are currently facing in a bearish market. Despite attempts to bounce back, resistance at $69,500 has proven to be a significant hurdle for Bitcoin bulls.
The aftermath of Bitcoin’s flash crash serves as a stark reminder of the risks and volatility inherent in the crypto market. Traders, particularly those with leveraged positions, must exercise caution and conduct thorough research before making investment decisions. The losses and liquidations seen in the wake of the flash crash underscore the importance of risk management and staying informed in an ever-changing market landscape. As the crypto market continues to evolve, vigilance and preparedness are key to navigating turbulent times.