Crypto Market Experiences $1.8 Billion Liquidation Amid Bitcoin Price Drop
The crypto industry experienced significant volatility recently, with Bitcoin price #BTC dropping to a daily low of approximately $94,725. The total crypto market fell over 6% in the past 24 hours, settling around $3.6 trillion on December 10 during the mid-London session.
This led to a record liquidation of about $1.8 billion, primarily affecting long traders, who accounted for over $1.5 billion of the liquidations. The largest single liquidation order occurred on the Binance exchange, involving ETH/USDT valued at nearly $20 million.
Major Reasons for $1.8B Crypto Liquidations
Panic selling characterized the last 24 hours, triggered by several negative news events. Notably, Google announced its quantum chip innovation, Willow, capable of solving tasks in under 5 minutes—tasks that would take current supercomputers 10 septillion years. This raised concerns within the Bitcoin community regarding the security of BTC's SHA-256 algorithm.
Charles Edwards, founder of Capriole Investment, stated that while the threat of quantum computing is real, it won't affect Bitcoin for another 5-10 years, urging core developers to prepare network updates against potential quantum attacks.
Additionally, fears grew as El Salvador and Bhutan indicated a slowdown in their Bitcoin initiatives. Conversely, the United States is moving toward strategic Bitcoin reserve legislation that could impact other countries, including Russia.
What's Next?
Following the recent liquidations, fresh capital influx may drive bullish sentiment. Spot Bitcoin ETFs saw a net cash inflow of approximately $479 million, led by BlackRock’s IBIT and Fidelity’s FBTC. Spot Ether ETFs also had a net cash inflow exceeding $149 million, totaling around $1.56 billion in cumulative inflows. As reported by Coinspeaker, digital assets investment products recorded the largest weekly cash inflow of over $3.8 billion in early December.
With Bitcoin supply on centralized exchanges at a multi-year low of about 2.25 million, a new bullish cycle appears imminent.