Bitcoin Plummets to $29,000 in Unexpected Sell-Off; Long Positions Account for 98% of Over $160M in Cryptocurrency Liquidations

Bitcoin Drops Below $30,000 as Massive Sell Order Hits Binance

On Wednesday, Bitcoin (BTC) plummeted by more than 3% within 15 minutes during European morning hours. The largest cryptocurrency by market capitalization fell below $30,000, according to CoinDesk data. Further declines saw BTC dip to as low as $29,000. While the sudden sell-off did not have an immediate fundamental reason, market experts believe that a massive market sell order on crypto exchange Binance and an unexpectedly high U.K. March inflation figure of more than 10% might have affected market sentiment.

The massive sell order of Bitcoin on Binance may have initiated a long squeeze. This resulted in more than $25 million in bitcoin futures being liquidated, with long positions making up 98% of the positions. Furthermore, Vetle Lunde, a senior analyst at K33 Research, noted that “the hotter-than-expected U.K. CPI may have weighed over risk assets, including BTC. But the gravity of the reaction has been far more severe than in other asset classes.”

Prominent Crypto Twitter trader @52kskew pointed out that a 16,000 bitcoin sell order worth over $467 million at current prices preceded the sudden dump. This may have initiated the long squeeze.

Liquidation

Liquidation occurs when an exchange forcefully closes a trader’s leveraged position due to a partial or total loss of their initial margin. This happens when investors are unable to meet the margin requirements for a leveraged position, and they don’t have sufficient funds to keep the trade open. Large liquidations can signal the local top or bottom of a steep price move, allowing traders to position themselves accordingly.

The Broader Crypto Market

The slide led to a sell-off in the broader crypto market, with Ether (ETH), polygon (MATIC), and dogecoin (DOGE) falling 5.3% in the past 24 hours. Solana (SOL) also lost nearly 9%.

Conclusion

The sudden sell-off of Bitcoin was due to a massive market sell order at Binance, which initiated a long squeeze. An unexpectedly high U.K. March inflation figure of more than 10% may have also affected market sentiment. The slide also led to a sell-off in the broader crypto market.

• Bitcoin dropped more than 3% in just 15 minutes in European morning hours.
• A huge market sell order on Binance and an unexpectedly high U.K. March inflation figure of more than 10% might have influenced market sentiment.
• A long squeeze resulted in more than $25 million in bitcoin futures being liquidated.
• Large liquidations can signal the local top or bottom of a steep price move, allowing traders to position themselves accordingly.
• The slide led to a sell-off in the broader crypto market, with Ether (ETH), polygon (MATIC), and dogecoin (DOGE) falling 5.3% in the past 24 hours. Solana (SOL) also lost nearly 9%.