Bearish bets on bitcoin (BTC) have cost traders over $178 million in the past 24 hours as prices soared past a critical resistance level. The jump in bitcoin prices came as a ticker registration bumped hopes of an oncoming spot bitcoin exchange-traded fund (ETF) approval.
Data shows bitcoin-tracked futures accounted for nearly 50% of the total $400 million in crypto liquidations over Monday, with ether futures only seeing $50 million in liquidations over long and short positions.
Liquidation occurs when an exchange forcibly closes a trader’s leveraged position due to a partial or total loss of the initial margin. It happens when a trader cannot meet the margin requirements for a leveraged position (fails to have sufficient funds to keep the trade open).
Crypto exchanges Binance, Huobi and OKX saw liquidations worth $50 million each, suggesting a large amount of leverage used on those platforms. The largest single liquidation order occurred on Binance, with an order value of $10 million.
Bitcoin prices spiked 12%, surging to a high of $35,200 before retreating on Tuesday morning. The huge move was likely driven by relatively lower volumes and outsized demand – adding tens of billions of dollars to market capitalization in a few hours.
Crypto communities and analysts attributed the move to the ticker registration of Blackrock's spot bitcoin ETF – which remains under consideration with the U.S. Securities and Exchange Commission (SEC).
Such expectations have boosted hopes of a bullish revival of the crypto market, which has been in a general lull over the past several months.
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“Bitcoin has also been encouraged by possible ETF approval and an increasing number of ETF submissions by leading companies,” shared Lucy Hu, senior trader at Metalpha, in a message last week. “(With the) Bitcoin ETF approval and halving event in April, the crypto market could kickstart a very robust bull market,” Hu added.