Crypto Liquidations Unleash a $113 Million Shockwave in the Market

Key Points

1. $113 million worth of futures were liquidated in one hour, with a total of $409 million over 24 hours, indicating a significant market shock.

2. Crypto liquidations occur when a trader's margin balance falls below the required level, forcing the exchange to close their leveraged position to prevent further losses.

3. High leverage amplifies both gains and losses, making traders vulnerable to rapid price swings and large-scale liquidations.

4. Major cryptocurrencies like Bitcoin (BTC) and Ethereum (ETH) are most susceptible to liquidations due to their high trading volumes and liquidity.

5. The article emphasizes the importance of risk management strategies, such as using stop-loss orders and avoiding excessive leverage, to mitigate losses during volatile market conditions.