Crypto liquidations hit $1 billion as market sentiment drops to 10-month low

The cryptocurrency market suffered massive liquidations after the price crash. After the weekend, the market recorded one of its worst crashes, with Bitcoin dropping below $30,000 for the first time this year. What followed was hundreds of millions of short liquidations. However, as the market continues to crash and liquidations have now surpassed $1 billion, the carnage appears to be far from over.

Crypto traders get Rekt

Cryptocurrency traders have been hit hard after the crash that rocked the market over the weekend.However, as always, this is always skewed towards one demographic and bulls take a hit 77.5% longs account for most of the $421 million liquidation figure This was recorded on Monday.

Related reading | Bitcoin price hits three-month low, what’s driving it?

Traders in the space face more challenges as Tuesday approaches. While most speculated that Bitcoin would not drop to $30,000, it did, even briefly dipping into the $29,000 region before recovering again. Although the damage will be done as more traders see their positions liquidated in the market.

That figure, now over $1 billion, was liquidated in the past 24 hours, with bitcoin and ethereum traders bearing the brunt. Once again, long positions continue to dominate liquidations as Bitcoin struggles to find its footing and recover. Those figures were slightly better for bull traders, falling to 71.8% Tuesday from 77.5% on Monday.

Crypto liquidations surpass $1 billion | Source: Coinglass

this Liquidation totals $1.1 billion at the time of writing. Longs accounted for $789.27 million, while shorts totaled $310.04 million. Bitcoin and Ethereum continued to compete with each other, with liquidations of $354.77 million and $326.51 million, respectively.

Market sentiment plummets

As the cryptocurrency market collapsed, so did market sentiment. This is really not surprising, as sentiment has been negative for the past few weeks. However, the market crash accelerated the movement.

cryptocurrency Fear and Greed Index The reading is now 10. This is one of the lowest readings for the index over the past year. Because this number is so low, it puts the market in a state of extreme fear. That means investors are putting their money into the market more cautiously than ever, with some opting to liquidate their holdings to avoid further losses.

Related reading | Ethereum miners earn more than Bitcoin miners by $224 million

One thing to note, though, is that a downturn can also be a prelude to a bull market rally. The last time the index was this low was in July 2021. A recovery followed that eventually served as the starting point for Bitcoin to reach a new all-time high of $69,000. If history repeats itself, this could well be the start of another massive bull rally. That is, if the current crash has bottomed out.

Crypto Total Markek Cap on TradingView.com

Crypto market loses over $1 trillion | Source: Crypto Total Market Cap on TradingView.com
Featured image from ITPro Today, chart from TradingView.com

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