Seeking Accumulation Whales

The cryptocurrency market continues to experience significant declines this week, with approximately $191 million worth of crypto derivatives contracts liquidated in the last 24 hours.

Bitcoin (BTC) is the most affected, accounting for roughly $103 million of the total liquidations. Ethereum (ETH) follows with $33 million in liquidations. This comes after the 24-hour liquidation tally surged to $330 million yesterday afternoon when Bitcoin fell below $60,000 for the first time since early May.

This sharp increase in liquidations reflects heightened market volatility and bearish sentiment. In the past 24 hours, Bitcoin’s price dipped by 2.2%, selling for $61,516.48, while Ethereum’s price dropped by 0.7%, trading at $3,382.27. Over the past seven days, BTC and ETH have lost about 6.5% and 1.4%, respectively. Despite the recent plunges, both coins show signs of recovery, with Bitcoin up 0.2% and Ethereum rebounding by 1.8% compared to yesterday.

Julio Moreno, head of research at CryptoQuant, commented on Twitter, “What’s happening right now with Bitcoin prices is mostly related to a lack of demand growth or momentum from traders, whales, and ETFs.” Another CryptoQuant analyst, known as Mignolet, suggested on Twitter that accumulation whales might intervene to halt the bearish trend, potentially leading to a “V-shaped rebound.”

The current wave of liquidations has primarily affected long positions, according to CoinGlass. This trend has been observed across various exchanges, indicating a widespread market reaction to recent negative news and economic data. In the past 24 hours, 64,829 traders were liquidated, with total liquidations amounting to $294.14 million, according to CoinGlass. The largest liquidation order was a BTCUSDT contract valued at just over $15 million.

Bitcoin and Ethereum lead the liquidations, highlighting the ongoing volatility in the market’s largest cryptocurrencies. Bitcoin’s price has been under pressure due to macroeconomic factors, regulatory concerns, and shifts in market sentiment. Last week, German authorities sold off seized Bitcoin worth about $325 million within 48 hours. Robert Quartly-Janeiro, chief strategy officer at crypto exchange Bitrue, noted, “Having seen a slippage in the price of BTC, the German government is releasing significant tranches of BTC and has taken a view that the price of BTC is to soften for a while to come.”

As traders’ positions are forcibly closed, the ripple effect further pressures BTC’s price, contributing to a sustained bearish market outlook. Ethereum has also faced significant liquidations, though to a lesser extent than Bitcoin. The $33 million in ETH liquidations since yesterday underscores the challenges faced by the second-largest cryptocurrency, which is dealing with similar market pressures and investor sentiment.