The community was ecstatic when Bitcoin prices soared to around $30,000 on October 16 following unconfirmed reports that the United States Securities and Exchange Commission (SEC) had approved the first exchange-traded fund (ETF). of Bitcoin in cash in the country.
When the moment of fear of missing out (FOMO) dissipated and the supposed reports from the strict agency approving the complex derivative turned out to be false, prices fluctuated wildly, almost wiping out the gains made. As a result, more than $74 million worth of derivatives positions from several cryptocurrency exchanges, mainly OKX, Binance and Bybit, were forcibly closed for liquidation.
More than $74 million in Bitcoin positions liquidated
At the time of writing, Bitcoin is trading at around $28,200, nearly $2,000 below its October 16 highs, highlighting the level of volatility, especially in BTC markets. Following the recovery and sharp pullback, Coinalyze data shows that $56.6 million in short positions were liquidated.
At the same time, long positions worth US$18.4 million were closed. A large portion of the short positions, approximately $51 million, came from perpetual futures offered by exchanges such as OKX, Binance and ByBit.
Most traders liquidated OKX and a large percentage shorted the price action. Specifically, $17.6 million in short positions and $6.24 million in long positions were heavily closed. Similar positions were also resolved on Binance and Bybit.
The rumor that the SEC had approved the Bitcoin ETF implemented by BlackRock, one of the largest asset managers in the world, was debunked. As of mid-October, the SEC had still not given the green light to any company Bitcoin ETFs, including Fidelity. The SEC has been under increasing pressure to approve the product.
The approval of a Bitcoin spot ETF by the SEC would be a huge step forward for cryptocurrencies. In particular, it could simplify how institutions gain exposure to Bitcoin in a regulated way. The community at large remains bullish on BTC in the coming months.
Coupled with the fact that the network will cut network rewards in half in 2024, some analysts expect prices to break immediate resistance around $32,000 following the spot approval of a BTC ETF.