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Crypto downslide leads to over $430 million in liquidation, Bitcoin leverage traders worst-hit

Bitcoin, the biggest cryptocurrency by market value, has fallen to a three-month low of below $19,000, whereas, Ether's value has dropped to a two-month low of around $1,285.

September 19, 2022 / 09:35 PM IST
(Representative image: Reuters)

(Representative image: Reuters)

The current spell of downslide in the cryptocurrency market, which has been stoked by soaring inflation and the consequent hike in interest rates, has led to nearly half a billion dollar in liquidations.

The turmoil has led to total liquidations of $431.51 million, according to data shared by Coinglass on September 19.

Bitcoin leverage traders were the worst-hit, as they have lost $44.5 million.  The traders of Ether, the second largest cryptocurrency, followed with a total liquidation of $8.39 million, as per the data.

Earlier in the day, cryptocurrencies fell to fresh lows on regulatory concerns and as investors globally turned risk-averse with interest rate rises looming around the world. The US Federal Reserve is expected to announce the biggest rate hike in 40 years on September 21.

Bitcoin, the biggest cryptocurrency by market value, fell about five percent on September 19 to a three-month low of $18,387.

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Ether dropped three percent to a two-month low of $1,285 and was down more than 10 percent in the last 24 hours. Most other smaller tokens were deeper in the red.

The Ethereum blockchain, which underpins the ether token, had a major upgrade over the weekend called the Merge that changes the way transactions are processed and cuts energy use.

The token's value has fallen amid some speculation that remarks last week from U.S. Securities and Exchange Commission Chairman Gary Gensler implied the new structure could attract extra regulation. Trades around the upgrade also were unwound.

"It's speculation as to what might or might not happen," said Matthew Dibb, COO of Singapore crypto platform Stack Funds, on the regulatory outlook.

"A lot of the hype has come out of the markets since the Merge," he said. "It's really been a sell-the-news type of event," he added, given the nervous global backdrop, and said ether could test $950 in coming months.

"Looking at the landscape right now, both fundamentally and technically, it's not looking great. There's no immediate bullish catalyst that we can see that's going to prop up these markets and bring in a whole lot of new money and liquidity."

(With inputs from Reuters) 
Moneycontrol News
first published: Sep 19, 2022 09:35 pm
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