On Thursday, cryptocurrency prices experienced turbulent fluctuations as traders anxiously awaited a regulatory decision from the U.S. regarding the listing of spot-based ether exchange-traded funds (ETFs).
In the tense hour leading up to the eventual approval, the price of ETH first plummeted to $3,500 around the time of the closing of traditional U.S. markets. Subsequently, it surged to nearly $3,900 as unconfirmed reports of approval began to circulate, ultimately settling above $3,800 following the confirmation.
Read more: Where's Ethereum Headed Next After SEC Approves Ethereum ETFs?
Bitcoin Dips, ETH Holds Steady, and Liquidations Spike
During this period of volatility, Bitcoin (BTC) also experienced significant fluctuations, dropping to the low-$66,000s before spiking to $68,300, then retracing gains to fall below $68,000.
However, ETH demonstrated relative strength, registering a 1.5% increase over the past 24 hours, compared to BTC's nearly 3% decline during the same period. The broader CoinDesk 20 Index showed a 1.6% decrease throughout the day.
Amidst the turbulence, liquidations across all leveraged crypto derivative positions surged to over $350 million, marking the highest level since May 1, according to Coinglass data.
Source: Coinglass
Liquidations occur when an exchange terminates a leveraged trading position because the trader has experienced a partial or total loss of their initial margin. This can happen if the trader fails to meet the margin requirements or lacks sufficient funds to maintain the trade.
Read more: SEC’s Approval of Eight Ether ETFs and Its Market Impact
The majority of the positions that were closed out were long positions, betting on rising prices, amounting to approximately $250 million. This suggests that traders who were overly leveraged were taken by surprise by the sudden drop in prices. ETH traders bore the brunt of the impact, with $132 million in liquidations, followed by $70 million in BTC derivatives liquidations.
See more: Cryptocurrency Prices and Market Cap
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