Recent events in the cryptocurrency world have demonstrated how significant price fluctuations can lead to substantial liquidation of futures positions. This article examines what happened over the past 24 hours and its impact on the market.
What is Crypto Perpetual Futures Liquidation?
Crypto perpetual futures are derivative contracts without an expiration date that allow traders to speculate on the future price of a cryptocurrency. Liquidation occurs when a trader's margin balance falls below the maintenance margin, leading to automatic closure of the position.
24-Hour Liquidation Data
In the last 24 hours, liquidations in the cryptocurrency market reached significant volumes: * Ethereum (ETH): $149.83 million, with 85.35% being long positions. * Bitcoin (BTC): $67.37 million, with 77.18% being long positions. * Solana (SOL): $41.61 million, with 92.18% being long positions.
Reasons for Frequent Liquidations in Crypto Trading
Liquidations occur for several reasons: 1. High leverage, which increases the risk of losses. 2. High volatility of the cryptocurrency market. 3. Lack of established stop-loss orders. 4. Cascading effects of liquidations. 5. Emotional trading.
Recent events in the market highlight the high risks associated with investments in crypto perpetual futures. The strength of liquidations should be considered by all market participants when developing trading strategies.
