On the 12th of January 2023, Glassnode, the world’s leading on-chain analyst, tweeted that over $93 million in Bitcoin Short features were liquidated within hours.
Over $93M in #Bitcoin short futures positions have been liquidated in the last hour.https://t.co/aCUZ47uJCx pic.twitter.com/e26Xs8B4xP
— glassnode (@glassnode) January 12, 2023
The $93 million worth of BTC short futures position was betting that the crashing price of BTC would crash even further. To do this, they had to borrow crypto, sell it, and hope to buy it back at an even lower price. Then they return the borrowed assets and keep the difference. Thus a consistently increasing price spells increased loss for such players, as the value of their loan keeps increasing.
With the severe crypto winter covering cryptocurrencies, Bitcoin has been struggling to make a bullish run for a fraction of its all-time high. BTC’s price has been unable to break through the $18.5k price barrier, which has been the case for the past couple of months.
According to Edward Moya, a senior analyst at OANDA, is of the opinion that Bitcoin made a run to $18.5k after the inflation reduced and the Fed tightening loosened, which allowed risky assets to gain an initial momentum, but those benefits are fading fast.
Now, Bitcoin is on the verge of breaking through the $19k price resistance. This is a first since the 9th of November 2022, when the price dropped to $15.7k. And is believed that whales in the crypto space are finally taking an interest in the asset and are probably behind the steady increase in price. The activities of BTC whales averaged out to 1,700 transactions, similar to the situation two months ago.
This is of interest because previously, the BTC whales were staying on the sidelines of the BTC ecosystem because of the thin liquidity in the crypto space and the effects of buying or selling on the then crashing BTC price. The asset’s resistance to large trades was very low, and very discouraging.
To make things worse, the aggregated 2% BTC market depth across major exchanges crashed from 11k BTC to around 6K BTC when the FUD and drama surrounding the FTX and Alameda crash unfolded. And the depth has still not recovered, struggling around 9k BTC. thus, the impact of large USD orders on the BTC price would have been twice compared to October 2022.
Fortunately, Major coins rallied on the 12th of January, as the global cryptocurrency market cap rose 2.9% to $906 billion.
