The cryptocurrency market shows signs of fragility after massive liquidations totaling $1 billion, triggered by an unexpected increase in the Producer Price Index (PPI) in the U.S. According to Coinglass data, over 386,000 traders had their positions liquidated in 24 hours, with $816 million in long positions and $307 million in short positions.
The primary reason was the market's reaction to economic data, specifically the PPI, which was higher than forecasted, raising concerns about inflation and Federal Reserve policy. $BTC , although it only lost 2.2%, fell to $118,500, while altcoins like Solana (-9%) and Cardano (-5%) experienced greater losses. Traders were mass transferring capital into stablecoins, aiming to reduce risks.
Experts, including Lukman Otunuga from FXTM, warn of further volatility due to the market's sensitivity to U.S. economic indicators. Analysts at QCP Capital note the rise in funding rates on derivative platforms, indicating mixed sentiments.
Despite the turmoil, Bitcoin maintains relative stability, and analysts at VanEck predict a possible retest of historical highs by the end of 2025. However, the market remains vulnerable to macroeconomic changes, and traders should exercise caution.
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