Bitcoin falls as US$600 mil in risky crypto bets wiped out
Cryptocurrencies fell on Wednesday as a wave of forced selling swept across digital-asset venues, with broader market jitters further weighing on risk appetite.
Bitcoin, the largest token, fell as much as 2.5% to US$83,470 while ether slumped 4.9% to US$2,567. Other smaller digital assets also fell, with XRP and Solana down 4.2% and 3.4% respectively.
The retreat accelerated as leveraged bets were unwound, with around US$609 million in crypto positions liquidated over the last 24 hours, according to Coinglass data.
“The dip in crypto prices serves as a leverage flush instead of a downward trend, stemming from crowded bets on higher prices being forced out, with most of the liquidations coming from long positions,” said Dan Khus, chief analyst at LVRG Research.
The crypto losses reflected a broader cooling in appetite for risk as renewed Iranian attacks in the Strait of Hormuz tempered hopes that shipping through the key waterway may return to pre-war levels, pushing Brent crude above US$101 a barrel.
US stocks’ futures edged lower after the S&P 500 closed at an all-time high in the prior session. Europe’s Stoxx 600 snapped three straight days of gains while a recovery in bonds also lost steam, with the 10-year Treasury yield climbing above 5.3%.
Traders are watching the release of Federal Reserve meeting minutes later on Wednesday for clues to the outlook for interest rates, said Rachael Lucas, an analyst at BTC Markets. “A hawkish read could lift yields and the US dollar, keeping pressure on risk assets,” Lucas said.
The slump in crypto prices comes after a recovery from bitcoin’s summer lows, although it remains well off its peak of US$126,000 a year ago.
Trading may remain choppy for the rest of the week in the absence of a fresh catalyst, according to Pratik Kala, a portfolio manager at Apollo Crypto. “If we lose US$83,000, it is possible we revisit the US$78,000 region for bitcoin, which should provide some support,” he said.
Source: Theedgemalaysia