The price of Bitcoin has fallen below the psychologically significant $20,000 mark once more. A total of $70.24 million worth of cryptocurrency has been liquidated in the last hour, according to cryptocurrency data platform Coinglass. 59% of the wiped-out positions are made up entirely of long positions.
Is Bitcoin’s drop linked to FTX and Binance drama?
The recent drop is most likely the outcome of cryptocurrency contagion brought on by the FTX’s uncertainty following its recent altercation with Binance. In just one hour, the FTT dropped abruptly by 14%. The exchange token is currently down a startling 23% from yesterday.
A surge in the volume of liquidations to $300 million was a result of the sequence of liquidations on the cryptocurrency market brought on by the sell-off linked to the circumstances surrounding the FTX exchange. The source of the majority of liquidations is the most intriguing aspect.
Every market downturn and a spike in liquidations is typically brought on by the price movement of Bitcoin, the largest asset on the market. Today, though, the situation is different. According to Liquidation Data, FTT and ETH are currently the two biggest sellers of pain.
When FTX removed nearly 300,000 ETH from its wallets in a matter of days, the selling pressure on the Ethereum markets increased so drastically that investors were unable to absorb the amount without harming the price of ETH.
Star Xu, the creator of the OKX exchange, recently expressed his worries on Twitter regarding the conflict between Binance and FTX, the two biggest cryptocurrency exchanges in the industry.
According to him, not a single player in the space, including Binance, would be able to profit from FTX Token (FTT) becoming the new LUNA, which would mean that the latter hits the cryptocurrency market so hard that Bitcoin and altcoins plunge.
Customers and, more importantly, regulators would lose faith in cryptocurrencies, Star Xu emphasized in his tweet. He believes the only way out of this is to negotiate a new agreement with FTX co-founder Sam and convince CZ to stop selling the FTT bags of Binance.