Bitcoin experienced a rollercoaster day of extreme volatility, even by crypto’s dramatic standards. The world’s largest cryptocurrency by market capitalization skyrocketed to highs above $64,000, rallying over 12.6% in a matter of hours. However, Bitcoin failed to hold those gains, plunging all the way back down to around $59,000 just 60 minutes later. While Bitcoin currently trades around $60,000, it has remained up a solid 5% over the last 24 trading hours.
Bitcoin’s incredible price swings dragged the entire cryptocurrency market along for the ride. Major coins like Ethereum and Dogecoin posted similarly huge gains, with Ethereum up 7.4% at its peak and Dogecoin surging as much as 13%. But they also slid quickly, with Ethereum giving up its entire rally to trade flat on the day so far.
Driving much of the turbulence were massive leveraged position liquidations among crypto traders trying to profit from the momentum. According to data site Coinglass, a staggering $175.5 million worth of short Bitcoin positions got wiped out as prices shot upwards. Meanwhile, $85.9 million worth of longs got hit with forced sell-offs on the way back down. Across all cryptocurrencies, over $700 million in leveraged longs and shorts got decimated amidst the volatile trading.
The chaos seemed to catch many traders off guard. Crypto exchange giant Coinbase suffered technical difficulties, with its CEO Brian Armstrong citing a more than 10x traffic spike that overwhelmed its systems. Some users reported seeing zero balances, locking them out from being able to trade during the wild price action.
While Bitcoin has stabilized around $60,000, its future direction remains highly uncertain,, even by crypto’s standards. The crypto market remains primarily sentiment– and momentum-driven, with traders trying to profit from the swings. But with leverage fueling huge liquidations, the ride could get even bumpier from here. Strapping tight is advised.
