Cryptocurrency Market Turmoil: Solana Plunges Over 20%
Solana experienced a sharp decline of more than 20%, trading near $110, causing over $1 billion in trading positions to be wiped out within 24 hours.
The plunge in SOL was part of a broader market sell-off led by Bitcoin, which tested lows of $49,000, and Ethereum, which fell below $2,200. Solana had reached a high of $145 before the sudden drop to $111.
Investors are on edge due to concerns about a potential U.S. recession, global stock market instability, the Federal Reserve’s interest rate policies, and geopolitical tensions.
“I’m calling for an emergency 75 basis point cut in the federal funds rate and saying that another 75 basis point cut would be the minimum at next month’s September meeting,” Wharton’s Jeremy Siegel said. pic.twitter.com/s4CgWx962Q
— Squawk Box (@SquawkCNBC) August 5, 2024
The selling pressure from Jump Trading added to the volatility in the market, exacerbating losses for Ethereum and other altcoins.
Impact of Massive Liquidations
Hundreds of cryptocurrency traders faced significant liquidations as prices plummeted, causing the overall market capitalization to drop by 17% to below $1.9 trillion.
Early Monday, total liquidations surged by over 400% to more than $1.1 billion, mostly affecting long positions. More than $962 million in leveraged positions on bullish cryptocurrencies were liquidated.
With BTC and the wider market in decline, the number of traders liquidating their positions soared to over 301,700 within 24 hours.
As of the latest update, liquidations have surpassed $1.14 billion, with one significant order on Huobi wiping out $27 million of BTC.USD.
Notably, the amount of short liquidations stood at only $174 million, with $64 million bearish on BTC and $50 million bearish on Ethereum.
