Traders Lost Nearly $500 Million Due to Crypto Market Crash. What Happened
On January 8th, the cryptocurrency market experienced a sharp decline, with Bitcoin (BTC) momentarily dropping below $90,000, erasing all its gains from the beginning of the week. Ethereum (ETH) also fell, dropping over 5% to below $3,100. Although prices slightly recovered later, the total market capitalization fell by approximately 4% to $3.1 trillion.
This volatility led to the liquidation of over $460 million in leveraged trades, affecting more than 127,000 traders. The vast majority of these losses, $415 million, were from long positions betting on price increases, primarily in Bitcoin and Ethereum.
Market sentiment, as measured by the Fear and Greed Index, remained in the "fear" zone at 28 out of 100, indicating a tendency among investors toward panic selling. Furthermore, U.S. spot Bitcoin ETFs recorded a significant net capital outflow of nearly $486 million on January 7th, marking the second consecutive session of outflows. Ethereum ETFs also saw outflows, ending a three-session streak of positive inflows with a $98 million net outflow.
Despite the recent drop, Bitcoin's price remains up more than 3% since the start of the year.
RBK-crypto01/08 09:00
