Over $200M in Crypto Futures Bets Liquidated as Bitcoin Slumped Under $36K on Binance Settlement

The overnight price volatility in bitcoin and other cryptocurrencies washed out a notable chunk of leverage from the market, with bitcoin alone seeing more than $65 million worth of liquidations in futures markets.

AccessTimeIconNov 22, 2023 at 5:55 a.m. UTC
Updated Jan 24, 2024 at 12:57 a.m. UTC
10 Years of Decentralizing the Future
May 29-31, 2024 - Austin, TexasThe biggest and most established global hub for everything crypto, blockchain and Web3.Register Now

Binance’s settlement with the U.S. Securities and Exchange Commission (SEC) on multiple charges spurred a market decline, with the impact felt most by futures traders betting on further growth.

Data from CoinGlass show, exchanges have liquidated crypto perpetual futures positions worth $227 million in the past 24 hours. Bullish longs accounted for nearly 80% of the tally. Meanwhile, over $67 million worth of bitcoin longs and shorts, referring to bets on and against price rises, respectively, have been liquidated in the past 24 hours. This was among the highest liquidation events in 2023.

Traders of ether (ETH) futures took on $27 million in losses, while Solana’s SOL traders were hit for $10 million. BNB saw a comparatively smaller $6 million in liquidations. BNB is the token of the BNB ecosystem, which was created by Binance, and traders usually link the token with the exchange's fortunes.

Traders at crypto exchange Binance took on $100 million in liquidations, the most among counterparties, with OKX taking $62 million.

Crypto liquidations in the past 24 hours. (Coinglass)
Crypto liquidations in the past 24 hours. (Coinglass)

Liquidation refers to when an exchange forcefully closes a trader's leveraged position due to a partial or total loss of the trader's initial margin. It happens when a trader is unable to meet the margin requirements for a leveraged position (fails to 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.

Such data is beneficial for traders as it serves as a signal of leverage being effectively washed out from popular futures products – acting as a short-term indication of a decline in price volatility.

Binance, the world's largest crypto exchange, was criminally charged with breaking sanctions and money-transmitting laws and agreed to pay $4.3 billion to settle the allegations in "one of the largest penalties" the U.S. has ever obtained from a corporate defendant.

Founder Changpeng "CZ" Zhao pleaded guilty in Seattle to charges he personally faced and agreed to pay a $50 million fine and step down from the CEO job. Richard Teng, a former Abu Dhabi regulator and later Binance's regional markets head, will take over as CEO.

Edited by Omkar Godbole.

Disclosure

Please note that our privacy policy, terms of use, cookies, and do not sell my personal information has been updated.

CoinDesk is an award-winning media outlet that covers the cryptocurrency industry. Its journalists abide by a strict set of editorial policies. In November 2023, CoinDesk was acquired by the Bullish group, owner of Bullish, a regulated, digital assets exchange. The Bullish group is majority-owned by Block.one; both companies have interests in a variety of blockchain and digital asset businesses and significant holdings of digital assets, including bitcoin. CoinDesk operates as an independent subsidiary with an editorial committee to protect journalistic independence. CoinDesk offers all employees above a certain salary threshold, including journalists, stock options in the Bullish group as part of their compensation.

Shaurya Malwa

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.


Learn more about Consensus 2024, CoinDesk's longest-running and most influential event that brings together all sides of crypto, blockchain and Web3. Head to consensus.coindesk.com to register and buy your pass now.


Read more about