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The crypto market sees $174M liquidations after political developments impact sentiment.
The cryptocurrency market liquidations considerably surged following a sharp market-wide correction over the past day. It is in response to the move of U.S. President Joe Biden not to run in the upcoming elections, allowing his VP, Kamala Harris, to jump into the presidential race.
According to Coinglass data, the total crypto liquidations in the past 24 hours surged as high as $174 million. The correction just induced $111 million worth of long liquidation as the markets adaptation to political events has begun.
Bitcoin and Ethereum Hit Hard: $49.5M and $36.6M Liquidations; Binance Leads with $84M
In the same period, the number of liquidated short positions was $62.8 million. According to Coinglass data, while Bitcoin was the worst-hit cryptocurrency, losing $49.5 million, $27.9 million in long positions and $21.5 million in shorts Ether was not very far behind, with $36.6 million in liquidations, $27 million in longs and $9.6 million in shorts.
It was, however, interesting to note that the price of Bitcoin surged to a local high of $68,480 at some point around 01:00 UTC before a correction brought it down to $67,700. At the time of writing, Bitcoin trades at $67,100.
Coinglass also reported that the largest single Bitcoin liquidation in the past 24 hours reached $10.95 million and occurred on Binance. Binance takes the lead with the most significant share of 24-hour liquidations—nearly $84 million—with long positions making up 66.7 percent of those liquidations. OKX took second place with $54 million in liquidations.
Market Cap Peaks, Falls
Moreover, global crypto market capitalization reached $2.6 trillion around 00:30 UTC, according to CoinGecko data, not seen since June 12. This feat was instantly met with a reaction in the market, plummeting the total market cap back down to $2.56 trillion.
With recent developments in politics, investors and traders have been guessing at the Vice President Kamala Harris stance on cryptocurrency and what her presidency would do to the ecosystem. The uncertainty in policy positions has lent itself to volatility in the market, prompting cautious behavior among investors.
The surge in liquidations, therefore, reflects just how sensitive cryptocurrency markets are to large political events and announcements. With traders realigning their positions following such developments, the markets can move rather sharply in movements that could be humongous in nature, exhibiting the very dynamic and rather unpredictable nature of a crypto space.
The immediate reaction in the markets was cautious and downward, but the potential impact of a Harris presidency on the cryptocurrency market remains to be seen. In respect to digital assets and blockchain technology, investors will tactfully watch whatever policy statements or hints come from Harris and her team. This only goes to show that no event occurring anywhere in the world will ever have little or no influence over the cryptocurrency market, since it reacts to everything from political developments in the United States to other market dynamics.
As the liquidation rate rose by nearly a third in the last 24 hours, crypto investors are reminded of the space’s volatility and how crucial it is that one is informed and agile about trading strategies. With the continued changing of the political environment, so will the cryptocurrency market, demanding that its participants become ever more vigilant and responsive to new information.
