The crypto market crash erased over $170 billion within a day as hefty outflows occurred on Tuesday. Moreover, it led to more than $1.5 billion in liquidations of leveraged crypto assets. The slump comes in response to rising oil prices and geopolitical tensions stemming from the current U.S.-Iran conflict.
$1.5 Billion Liquidations Dominate Crypto Market Crash
Overall, $1.5 billion of crypto liquidations took place over the last 24 hours. Out of this, it included nearly $1.35 billion on the part of long investors, according to CoinGlass data.
In total, it appears that $141.8 million in crypto liquidations occurred over the past 24 hours, with the overwhelming majority of that loss accruing to long investors (nearly $135 million). The sell-off saw the liquidation of more than 224,500 traders.
Bitcoin-related liquidations accounted for approximately $805.8 million. It resulted in Bitcoin being the biggest contributor to the crypto market crash as the BTC price fell to the $66,000 level.
The amount of Ethereum liquidations increased to approximately $323.5 million. Meanwhile, XRP liquidations rose to nearly $28.8 million with longs accounting for over 95% of the positions liquidated.
The huge liquidation event exacerbated the market drop due to exchanges automatically closing leveraged trades that no longer had enough margin. This selloff drove Bitcoin, Ethereum, XRP, and other cryptocurrencies down further.
The crypto market crash also pulled down the investor sentiment. It forced traders to decrease their risk-taking and reallocate funds into safer assets like cash, gold, and investments tied to oil. Major crypto futures trading platforms also saw funding rates go negative. This hints at continued downward pressure in the short-term.
Bitcoin, Ethereum, XRP Prices Crash
Overall, the market has taken a hit with Bitcoin dropping to around $66,921. The BTC price saw a weekly loss of almost 12% and a daily dip of 6.44%. Further, Ethereum fell around 5.38% to $1,894 for the day.
In addition, Ripple’s XRP tumbled 6.43% to $1.21. In addition, Solana declined 7.54% to $74.92 as Dogecoin fell 7.05% to $0.093.
The volatility is due to investors’ attention to the U.S.-Iran war. This week, it was reported that Iran is suspending talks with the U.S. while threatening to disrupt the Strait of Hormuz, a major global oil shipping lane.
Brent crude prices rose sharply as fears of supply disruptions and retaliatory strikes in the region led to that. On Tuesday, oil price stood at $93.89 per barrel, up 1.88%, which weighed on the crypto assets.
Moreover, Bitcoin ETFs saw massive outflows of $3.5 billion in the last 10 trading days. It made the recent crypto market crash worse. In addition, Tether’s $14 million BTC transfer also sparked selloff concerns.