Bitcoin Liquidations Spark Price Spike
BTC has improved its value by 11% over the past 24 hours, according to data from Asia trading. This increase has effectively erased all losses suffered over 10-12 March, 2023. Multiple reports say the price spike is due to Bitcoin liquidations emanating from betting on the decline of cryptocurrency prices after Silvergate Bank and other crypto-related financial institutions fell into crisis last week.
Overall, more than $100 million in BTC shorts (in trading, shorting refers to selling, while long means buying) were liquidated on 13 March. While this figure looks like a significant sum, it is nowhere near the 14 January Bitcoin liquidations, which saw around $500 million cleared from several crypto futures.
Cryptocurrency futures constitute an agreement between two parties to buy and sell an agreed amount of a particular crypto asset at a future price within a given timeframe.
Bitcoin liquidations lead to a year-high trading volume
As exchanges such as Binance, Bybit, Huobi, and OKX spread losses from the liquidations, interest in BTC rose as many traders saw a positive signal from the crypto market activity.
By the close of Monday, 13 March, BTC recorded a trading volume of approximately $49.5 billion, the year's high and the largest since November 2022.
Overall, the crypto economy has been on a rebound in 2023. As always, the first digital currency has made up for gains lost during 2022 when it was crippled by Russia/Ukraine crisis, rising interest rates which led to renewed interest in government bonds and bills, and, of course, the crash of TerraUSD (UST). As of 10:00 UTC, BTC was up 48% year-to-date (YTD).
Despite the ups and downs of the crypto market, analyst Freddie Max at Price Prediction.net foresees BTC climbing to an average price of $31,243, testing the smallest possible price of $30,356, and reaching the best possible price of $34,916 by the end of the year.
Author: Raphael Minter
Raphael Minter/ Albert Zuhnden (preferred pen name) is a crypto finance writer, data miner, and fundamental analyst. Raphael has written hundreds of articles about centralized and decentralized financial instruments such as precious metals, commodities, stocks, and cryptocurrencies. He broke into digital finance in 2016 and believes digital assets and blockchain technology is the future of finance.