The announcement of the US Federal Reserve’s interest rate on Wednesday triggered a surge in volatility, resulting in approximately $48 million being liquidated within a 24-hour period in the Bitcoin market.
As of the current moment on Friday, Bitcoin (BTC) is once again trading just below the $43,000 threshold, having briefly surpassed this level during the tumultuous trading sessions on both Wednesday and Thursday.
Bitcoin achieved its yearly high of $44,700 on December 8, and the leading cryptocurrency is currently trading around 4.7% below that peak.
Over the past seven days, BTC has experienced a 3% decrease in value, though it still maintains a positive trend, showing a gain of over 17% over the last 30 days, as per data from CoinGecko.
Although the market seems to have assimilated the Federal Reserve’s decision to maintain steady interest rates, the initial response triggered substantial liquidations of leveraged derivatives positions, both on the long and short sides.
Based on Coinglass data, the day of the Fed’s announcement saw liquidations of $35.4 million in Bitcoin shorts as prices surged initially due to a more dovish stance from the Fed.
However, even bullish long positions were not immune, as $12.56 million worth of longs were eliminated after BTC experienced a sudden and sharp decline shortly afterward.
On the day of the announcement, a total of approximately $48 million in leveraged positions were liquidated. Notably, these liquidations were preceded by the Bitcoin market witnessing its most significant long liquidation event in three months on Monday, December 11, with a staggering $126.74 million in long positions being liquidated within a 24-hour period.
These liquidations occurred in response to a sudden crash in the spot price of Bitcoin, plummeting from $43,800 to a low of just over $40,000 in the span of a few hours.
