Bitcoin’s price drop below $100,000 led to $1.4 billion in liquidations

Cryptocurrency markets came under downward pressure on Friday, December 20, driven by Bitcoin’s price falling below $100,000, broad spot price declines, and an influx of funding.

Cryptocurrency market prices corrected shortly after the US Federal Reserve announced that it would slow interest rate cuts to address inflation concerns. After the interest rate is 25 basis points discountBitcoin (Bitcoin) fell below $97,000, dragging the broader digital asset market with it, according to crypto.news price data pages.

According to CoinGlass, Bitcoin’s decline triggered a mass liquidation of $1.4 billion, wiping out long, leveraged long positions within 24 hours. The largest transaction cleared was $15.8 million worth of Ethereum (Ethereum) Position on Binance. The identity of the trader and his initial investment remain unknown.

Flow Reset Open interest and funding rates via top trading venues like CME, Binance and Bybit.

Major altcoins like Solana (Sol) and Dogecoin (Doug) was hit hard by selling pressure, tracking gains from the “Trump win” rally and recording double-digit losses on the weekly time frame.

Despite widespread criticism of the Fed, experts noted that a market decline was inevitable in the wake of rising prices after the US elections. Calls have emerged for Bitcoin to consolidate between $85,000 and $95,000 as a healthier support range.

QCP Capital said on Telegram that excessive bullish sentiment in the market eventually led to a correction. The total cryptocurrency market, which was approaching $4 trillion for the first time, has fallen to nearly $3.4 trillion at press time, down 7.6% in the past day.

While it is easy to blame the sell-off on hawkish easing by the Fed, we believe the root cause of this morning’s collapse is an overly bullish market situation. Since the election, risk assets have enjoyed an impressive one-sided advance, leaving the market highly vulnerable to any shocks.

QCB Capital