Key Highlights;

• Nearly 300,000 traders faced a staggering $1 billion loss due to a market downturn.
• A twist in the tale as altcoins, not Bitcoin, lead the charge in trading losses.

Yello ParadiseSquad! Here’s the lowdown on a major shakeup in the crypto world! In a dramatic turn of events, the crypto market took a nosedive, leading to almost $1 billion in losses for traders over just 24 hours. This massive hit wasn’t led by the usual suspects, Bitcoin or Ethereum, but by a range of lesser-known altcoins.

The Numbers Breakdown

Here’s a closer look at the carnage: 297,536 trading positions were liquidated, totaling about $937 million in losses, with data pulled from CoinGlass’s liquidation heatmap. The majority of these were long positions, which saw $824.45 million wiped out. Short positions tallied up losses of $112.56 million.

An Unusual Suspect

Interestingly, it was the altcoins outside the top 50 by market value that accounted for a hefty chunk of the liquidations, totaling $248.02 million. This shift marks a notable departure from the norm, where big names like Bitcoin and Ethereum usually dominate the liquidation landscape.

Market Impact

The total crypto market cap took a significant hit, dropping by $142 billion to $2.384 trillion from the previous day’s $2.526 trillion. While the overall market shed about 5.6% of its value, the pain was more acute among the lesser-known altcoins, which lost about 9% of their value, reflecting nearly 28% of the total market.

Why Do Liquidations Happen?

For those scratching their heads, here’s a quick explainer: In crypto derivatives trading, investors bet on future prices by opening long or short positions. They put down collateral, agreeing on a price at which their holdings might be automatically sold off (liquidated) if things go south. When the market tumbles and hits these agreed prices, bam—liquidations happen.

The Safer Route

For those looking to dodge such dramatic losses, the spot market offers a gentler approach. Buying and holding cryptocurrencies directly means you avoid the risk of liquidation that comes with derivatives and futures trading.

So, ParadiseSquad, as the dust settles from this market meltdown, it’s a stark reminder of the rollercoaster nature of crypto investing. Whether you’re trading futures or buying spot, stay sharp and maybe keep a soothing beverage at hand!