Crypto traders had a whirlwind day after nearly 68,000 positions were liquidated in the past 24 hours. Total crypto liquidations crossed the $257 million mark.
The news comes amid a rate hike by the US Federal Reserve and regulatory action by the SEC against crypto businesses.
CoinGlass data showed that the liquidation trend was dominated by Bitcoin, Ethereum, and XRP during this period.
BTC crypto liquidation surpasses $130M
Total liquidations on bitcoin were close to $132 million, while Ethereum traders lost $51 million at press time, based on market cap. Nearly $8 million in liquidations were from XRP positions.
CoinGlass notes that the largest single liquidation order was executed on BitMEX at $7.39 million.
The figures came after the US Fed hiked interest rates by 25 basis points. Many analysts believed that the apex bank may tighten its monetary policy amid turmoil in the banking sector. But with consumer inflation easing at 6.0% YoY, according to the last government data, the Federal Reserve was not the pivot.
Meanwhile, the global cryptocurrency market cap has decreased by 2% in the last 24 hours. However, the cumulative capitalization is still well above the $1 trillion mark. Bitcoin has also lost value in the same range, but remains at a multi-month high above $27,000.
CoinShares’ Digital Asset Fund Flow Weekly report also recorded outflows for six consecutive weeks. Based on a report published on March 20, there were withdrawals of around $500 million in digital assets during this period. Bitcoin led the trend last week with outflows of $113 million.
According to CoinShares, the outflows are due to the need for more liquidity from a negative outlook during this banking crisis. It mentioned that a comparable scenario was observed when the COVID outbreak first started in March 2020.
Regulators Pull Crypto Businesses, Influencers
The massive liquidations also come amid a crackdown by the securities regulator. The US Securities and Exchange Commission recently sued crypto mogul Justin Sun, Tron Foundation, BitTorrent Foundation, Rainberry Inc, Austin Mahone and DeAndre Cortex Way for selling unregistered securities.
Meanwhile, several celebrities are also part of the securities violation charges. Eight celebrities, including Lindsay Lohan and Jake Paul, have been arrested for promoting illegal crypto-based products, a release from the agency confirmed.
The SEC has also issued a Wells Notice against the largest US crypto exchange, Coinbase. The securities regulator brought an enforcement action against Coinbase Global Inc. for offering certain products.
That said, there is a positive outlook among many in the industry. Cathy Wood of Arch Invest told Bloomberg that bitcoin’s resilience amid the banking crisis could be a draw for institutional investors to return to the system.
“The fact that bitcoin in particular moved very differently from equity markets was quite instructive. We believe that the price action through this crisis is going to attract more institutions.”
BeInCrypto has reached out to the company or the person involved in the story for an official statement regarding the recent development, but has yet to hear back.