The cryptocurrency market has experienced a tumultuous 24 hours, liquidating over $624 million in leveraged positions, with a staggering 83% being long positions. The spotlight is now on Ether, Ethereum’s native currency, as it teeters on a critical price point that could trigger significant financial fallout.
Ether’s Decline Sparks Concern
Ether has seen a sharp 9.3% decline, dropping to $3,254 in the span of 24 hours. This downturn is part of a larger weekly slide exceeding 18%. Should Ether’s value dip below the $3,100 threshold, it’s poised to catalyze the liquidation of more than $212 million in leveraged long positions. This scenario is grounded in data from Coinglass, highlighting the precarious nature of the current market.
The Threat of Further Liquidations
The potential for liquidation escalates if Ether breaches the $3,000 psychological mark, with liquidations expected to surge to $237 million. The recent volatility has already led to significant liquidations, predominantly affecting long positions—investors who anticipated a price increase. This resulted in $514 million in long position liquidations and $110 million in short position liquidations.
Exchange Liquidation Dynamics
OKX exchange bore the brunt of these liquidations, seeing $90.8 million in losses. Binance and Bybit followed, with $79.9 million and $23.4 million, respectively. These figures, sourced from Coinglass, underscore the widespread impact of the market’s current state.
Broader Market Implications and Ether’s Outlook
Bitcoin’s recent pullback has raised questions about the institutional investment appetite and the potential for a market recalibration. A Bitfinex Analyst report, shared with Cointelegraph, suggests a period of adjustment as the market seeks balance amid new Spot Bitcoin ETF inflows and significant Ethereum and Layer 1 blockchain project investments.
In a positive note for Ethereum, Ether net outflows from exchanges hit a record on March 11, with 154,000 Ether moving off exchanges. This reduction in exchange supply could signal an upward price trajectory, though it may also reflect traders shifting their Ether for trading on ERC-20 protocols or Layer 2 solutions like the Base mainnet.
This precarious situation for Ether underscores the volatile nature of the cryptocurrency market, highlighting the tightrope investors walk between potential gains and significant losses.
