Binance's recent update on margin levels has led to sudden changes in the crypto market, causing significant price volatility.
Impact of Binance's Update
The recent update by Binance regarding leverage and margin levels led to sudden liquidations and sharp price declines in the crypto market. Notably, this affected the Solana-based memecoin ACT, which dropped by more than 50%.
Investor and Expert Reactions
Following the update, several cryptocurrencies traded on Binance experienced double-digit losses, with DEXE and DF falling by approximately 23% and 16% respectively. Investors began questioning the effects of the system’s regulations after suffering losses from these sudden sell-offs. Wintermute CEO Evgeny Gaevoy indicated that the market’s reaction occurred after the update but did not accept direct responsibility for the outcomes.
Quote:
CITE_W_A: “The market’s reaction began after the changes were implemented.” — Evgeny Gaevoy
Effects on the Crypto Market
The update regarding margin levels by Binance also impacted perpetual contracts, raising concerns about the risk of existing positions being quickly liquidated. One investor reportedly suffered millions in losses due to the decline in the ACT token price. However, some cryptocurrencies are showing signs of recovery in the current market conditions. Increases in various tokens, such as Compound, have generated expectations for partial market improvement.
Investors are advised to reassess their positions in light of sudden price fluctuations caused by the unexpected changes in Binance's rules.
