Bitcoin’s Wall Street debut results in $83 million liquidation | CoinDesk JAPAN

The debut of Bitcoin (BTC) exchange-traded funds (ETFs) in the United States did not trigger an outright sell-off as some had expected, but the wild price swings nonetheless led to long Bitcoin futures trading. In total, the impact of short trading was approximately 80 million dollars (approximately 11.6 billion yen, equivalent to 1 dollar = 145 yen).

Shortly after the first ETF began trading, the price of Bitcoin rose to over $49,000 at one point. As a result, the prices of major coins such as Ethereum (ETH) and Solana (SOL) rose by as much as 10% within hours.

But Bitcoin reversed as its initial euphoria wore off, with market observers saying the hundreds of millions of trades driven by Grayscale’s Bitcoin ETF were likely driven by sellers.

BTC prices have fallen to $45,700, the level before the ETF began trading, and have not broken above the $47,000 mark since late Thursday.

The Grayscale Bitcoin ETF is a relisted version of a now-defunct Bitcoin trust product that held a fixed amount of physical Bitcoin and traded at a discount throughout 2023.

These price fluctuations caused both long and short Bitcoin futures traders to liquidate amidst the chaotic price movements. Nearly $40 million worth of Bitcoin was affected in both directions, resulting in a total liquidation of $83 million. The crypto asset (virtual currency) exchange most affected was Binance.

Bitcoin and major coin futures have been liquidated. (Coinglass)

The drop in Bitcoin caused similar price movements in other futures products, with liquidation losses exceeding $230 million. This means that traders have suffered significant losses even though the market as a whole has been flat over the past 24 hours.

Liquidation refers to an exchange forcibly closing a trader’s leveraged position due to the loss of some or all of the trader’s initial margin. This occurs when a trader is unable to meet the margin requirements for a leveraged position (does not have enough funds to continue trading).

｜Translation: CoinDesk JAPAN
｜Edited by: Toshihiko Inoue
｜Image: Shutterstock
｜Original text: Bitcoin’s Wall Street Debut Ends in Tears for Futures Traders, Leads to $83M Liquidations