If Ethereum (ETH) sees another significant drop this weekend, it could lead to the liquidation of over $500 million worth of long positions. This worry arises from the recent volatility in the ETH market, where rapid price fluctuations have become a common occurrence.
Price Swings Threaten Ethereum Longs
During the previous weekend, ETH experienced a 2.5% decline, falling to $3,036, resulting in liquidations for certain long positions. An even sharper drop of 9% occurred on April 13, driving the price to $2,950 before it bounced back.
At present, ETH is trading at $3,052, marking a 0.52% decrease over the last 24 hours. If a similar price swing occurs this upcoming weekend, it could trigger a larger wave of liquidations. Based on current market positions, potential liquidations could surpass $853 million in the event of another 9% decline.
Ethereum Longs at Risk Amid Potential Weekend Volatility
Adding to the uncertainty surrounding Ethereum’s price is the looming possibility of the US Securities and Exchange Commission (SEC) rejecting spot Ethereum ETF applications in May. Multiple US issuers and other entities anticipate such rejections by the SEC.
This anticipation follows recent meetings between issuers and regulators, which have been described as one-sided, with agency staff refraining from commenting on the proposed products.
In a related development, blockchain technology company Consensys has filed a lawsuit against the SEC regarding its stance on potentially classifying ETH as a security.
The combination of potential weekend volatility and ongoing regulatory uncertainty regarding spot Ethereum ETFs is fostering a tense atmosphere for Ethereum investors. With over half a billion dollars in long positions at stake, this weekend could be a pivotal moment for Ethereum investors and the broader altcoin market.
