Big Drop, Big Liquidations: Major cryptocurrencies like Bitcoin and Ethereum experienced a sharp price drop on Friday afternoon. This resulted in a significant amount of forced selling (liquidations) totaling nearly $300 million, primarily from long positions that were betting on rising prices.
Price Swings: Bitcoin went from over $71,000 to under $69,000 in just 40 minutes, while Ethereum dipped from $3,800 to below $3,650. Both currencies are currently showing signs of recovery.
Possible Causes: Analysts suggest the drop might be linked to concerns about the Federal Reserve raising interest rates for a longer period, potentially impacting riskier assets like crypto. Additionally, the recent approval of spot Ethereum ETFs might have contributed by increasing open interest in Ethereum futures, leading to potential price drops as leverage is unwound.
Memecoins Feel the Heat: Memecoins, known for their volatility, took a harder hit. Solana’s BONK and Ethereum’s Pepe both saw significant price drops within a short timeframe.
Compared to the crypto market’s turbulence, major Wall Street indexes showed relative stability. The S&P 500 saw a slight gain, while the Nasdaq dipped modestly.
