Wobble in Bitcoin, Ether, XRP Prices Cause Crypto Bulls and Bears to See $450M Liquidations Each:
What to know:
●Market volatility led to $450 million in crypto futures liquidations as U.S. tariffs took effect.
●President Trump imposed significant tariffs on auto imports and major trading partners, causing market turmoil.
●Bitcoin and other cryptocurrencies experienced sharp declines after initial gains, reflecting market uncertainty.
President Donald Trump officially levied a 25% tariff on auto imports and a minimum 10% tariff on all exporters to the U.S. Additional duties were imposed on the nation’s biggest trading partners in Asia and the European Union, with China facing a 50% hike on several goods and a 26% fee on some Indian goods.
Turmoil in markets ensued with gains from the past three days wiped out in U.S. indices and cryptocurrencies. Asian markets tumbled early Thursday and U.S. 10-year Treasury yields slumped to the lowest level in more than five months. Gold set yet another record high.
Liquidation refers to when an exchange forcefully closes a trader’s leveraged position due to a partial or total loss of the trader’s initial margin. It happens when a trader is unable to meet the margin requirements for a leveraged position (fails to have sufficient funds to keep the trade open).
Single-sided large liquidations can signal the local top or bottom of a steep price move, which may allow traders to position themselves accordingly. However, Thursday’s liquidations can be considered a sign of market uncertainty
