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Bitcoin fell during the first US trade after Christmas. This decline resulted in over $70 million in liquidations of leveraged long positions on various derivatives platforms.
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As US markets opened their first post-Christmas session, Bitcoin fell, plummeting by nearly $3,000 in just a few hours.
The sudden drop swept the derivatives market, triggering leveraged extended liquidations of more than $70 million over four hours, according to Coinglass data.
This sharp decline highlights the inherent volatility in the crypto market, where high leverage magnifies both gains and losses. If prices fall rapidly, traders with leveraged long positions may face forced liquidation due to insufficient collateral to maintain their open positions.
Mass liquidation events often intensify downward momentum as automated sales create additional selling pressure in an already declining market.
The leading digital asset was trading at $87,175 at the time of writing, down about 2% in the past four hours.
