Bitcoin's (BTC) early Friday slide, triggered by concerns about crypto-friendly bank Silvergate (SI), shook out bullish leverage from the futures market.
Exchanges liquidated longs or bullish bitcoin futures worth over $62 million during the Asian hours, the highest amount since August, according to data from Glassnode. Short liquidations worth just over $500,000 were also observed.
Liquidation happens when the market moves against a trader's bullish/bearish bet, leaving them with insufficient funds to keep the leveraged trade open.
The dominance of long liquidations shows the leverage was skewed on the bullish side, meaning most traders were positioned for a price rally.
Bitcoin, the leading cryptocurrency by market value, fell over 5% to $22,000, reaching the lowest since Feb. 14, CoinDesk data show.
Shares in Silvergate fell 50% on Thursday after the crypto-friendly lender said it's evaluating "its ability to continue as a going concern" and delayed filing its annual report with the Securities and Exchange Commission.
Bitcoin's late reaction to Silverage news perhaps stemmed from fears that the crisis at the bank known to facilitate fund transfers between exchanges and other market participants may worsen the liquidity crunch in the crypto market.
Most exchanges on Thursday announced a suspension of business tied with Silvergate.
Bitcoin's long liquidations surge as prices slide. (Glassnode)
All writers’ opinions are their own and do not constitute financial advice in any way whatsoever. Nothing published by CoinDesk constitutes an investment recommendation, nor should any data or Content published by CoinDesk be relied upon for any investment activities. CoinDesk strongly recommends that you perform your own independent research and/or speak with a qualified investment professional before making any financial decisions.
Follow us on Telegram
Stay updated of all the news
Ethereum price to outpace Bitcoin price as ETH jumps over key hurdle where BTC fumbles
Ethereum (ETH) price is working on its recovery after it dipped to a two-week low on Thursday. While Bitcoin price has failed to make a similar move and head back above $26,500, Ethereum is outpacing Bitcoin and has been able to push above $1,800.
Bitcoin price retreats as US core PCE inflation comes hotter than expected
Bitcoin price declined in response to April's US core PCE inflation data, which came higher than anticipated. The knee-jerk reaction from market participants increased the selling pressure on the asset, pushing it below $26,400.
Cardano founder says CIP-1694 upgrade will be a “wake-up call” for crypto
Cardano, one of Ethereum’s main competitors, is gearing up for further decentralization through its Improvement Proposal (CIP-1694), which is expected to bring the Ethereum-killer altcoin into a new era of governance with decentralization in its decision-making.
PEPE price action puts traders on the edge of their seats as pennant gets filled
PEPE price is entering the very last possible stage before finally determining whether bulls or bears have the winning hand in this poker game showdown.
Bitcoin: BTC delays inevitable crash to $25,000
Bitcoin price is delaying a crash that has been brewing for roughly two weeks. A failure to push higher could result in a steep correction next week. The troubling macroeconomic conditions could be key in catalyzing and trigger a nosedive for BTC holders.