Another $1 billion wipeout: Why is Bitcoin seeing extreme price moves?

Nearly $1 billion worth of Bitcoin (BTC) futures contracts were liquidated on Jan. 13, a day after the big shakeout. The continuous loop of liquidations is causing extreme volatility and large price swings in the cryptocurrency market.

Total Bitcoin liquidations. Source: Bybt.com

In the Bitcoin futures market, traders borrow additional capital to bet against or for Bitcoin. The technical term for this is leverage, and when traders use high leverage, the liquidation threshold gets tighter.

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4 comments

  1. Comment Test

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