Traders Lose $805 million Following Bitcoin Flash Crash
Bitcoin’s rise in the past few weeks has been an exciting ride for traders and investors who have been able to rack in profits. However, the recent developments in the last 24 hours show the thin line between profits and losses.
$805 million Liquidated
Bitcoin made quick gains in the early hours of the day, surging past the $18,000 barrier to set a new yearly high of $18,472. Soon after achieving this milestone, Bitcoin suffered a flash crash within minutes, dropping to $17,200.
This culminated in a pump of 11%, followed by a dump of 7%. The sudden rise and drop affected traders on top crypto platforms, with about $805 million liquidated during this period. This data was represented by ByBt.com, which posted a liquidation chart of some of the top crypto platforms.
Bitcoin dominated the list, with traders losing $617 million, representing 76% of the total losses. Ethereum traders suffered the second-most losses with $88.3 million liquidated during this period. On close observation of the chart, the major losers on most of the exchanges were traders that shorted. Binance was the only exception, with 51.6% of losses falling to traders that longed their crypto assets.
This development shows how volatile the crypto market can be as Whales are capable of manipulating the market. The recent bullish run has surprised many as Bitcoin has continued to surge despite anticipation of an extended bearish period. Bitcoin has corrected in the past few hours and is currently valued at $17,825.
Veteran Crypto Trader Warns Traders to Use StopLoss
One of the reasons why traders typically lose money during volatile swings from Bitcoin is a lack of protective measures. Veteran trader Peter Brandt today warned crypto traders to utilize stop losses during trades. Brandt suggested that the major reason traders lose is the lack of stop losses in a tweet to their followers.
He further added that the advice also applied to leading cryptocurrency Bitcoin. With the latest developments regarding traders liquidating on trades, Brandt’s advice is particularly useful.