In a tumultuous trading session that caught both bulls and bears off guard, the price of Bitcoin (BTC) briefly surged past the $89,000 mark before sharply correcting to around $87,000. The sudden volatility, which resulted in over $600 million in liquidations across futures contracts, marked the highest levels of market turbulence since Bitcoin’s previous all-time high above $73,000 in early April.
Futures Traders Caught in the Crossfire
As Bitcoin’s price whipsawed, futures traders on both sides of the market felt the pain. According to data from Coinglass, nearly $700 million in crypto-tracked futures were liquidated, with long positions accounting for roughly $380 million and short positions making up the remaining $290 million. The cumulative losses were the highest seen since Bitcoin’s rally past $73,000 earlier this year.
BTC-tracked futures alone saw over $200 million in short liquidations, while bearish ether trades resulted in another $40 million in losses. The carnage extended to altcoins as well, with futures contracts for major and mid-cap assets like Solana (SOL) and Aptos (APT) each recording more than $25 million in liquidations.
The unusually large liquidation figures suggest a swift return to riskier, leveraged bets among crypto traders, a stark contrast to the more cautious approach seen in recent months.
– According to a close market observer
Altcoins Ride the Volatility Wave
Bitcoin wasn’t the only digital asset caught up in the market mayhem. Annualized funding rates, a key metric for gauging trader sentiment, spiked to over 30% across some altcoin-tracked futures, indicating a surge in bullish bets. This marked a significant shift from the single-digit funding rates seen during more stable periods.
Election Euphoria Fuels Bullish Sentiment
The recent volatility comes on the heels of an unusually bullish weekend for Bitcoin, which saw the asset gain more than 7% in just 24 hours. Many attribute this positive sentiment to the aftermath of Republican candidate Donald Trump’s victory in the U.S. presidential election last week.
Some analysts predict that a Republican sweep could propel the total crypto market cap from its current $3 trillion valuation to an astounding $10 trillion by the end of 2026, with Bitcoin potentially reaching $100,000 by the end of this year.
– According to a market analyst
Caution Advised Amid Leverage Risks
Despite the bullish sentiment, some traders are urging caution in the short term. They warn of a potential price correction, highlighting the risk of a leverage washout should Bitcoin climb above $90,000. Such a scenario could significantly slow the asset’s ascent toward the much-anticipated $100,000 milestone.
As the crypto market continues to navigate uncharted territory, one thing remains clear: volatility is back with a vengeance. Whether Bitcoin can sustain its momentum and reach new all-time highs in the face of such turbulence remains to be seen, but one thing is certain – the ride is far from over.
