The price of bitcoin plunged on Wednesday to a monthly low of around $8,700. The sudden drop stung BitMEX traders particularly badly, with the platform reporting $157 million in liquidations in just a single day, BeInCrypto reported.
The bitcoin price performance at the start of 2020 had many analysts bullish. With the rising price, optimism missing from the industry since the summer of 2019 bull run was starting to return.
More recently, things have begun to look a little more shaky for bitcoin. From a yearly high of around $10,400, the leading crypto asset has spent the last two weeks in a clear downtrend.
Bitcoin also experienced its fifth-biggest hourly price drop in terms of dollar value ever this month. The plunge took a cool $1,000 off the price of BTC in less than 60 minutes.
On Wednesday, the existing downtrend became even more pronounced. In fact, the market shed more than $10 billion over the course of the day.
The sudden plunge in the bitcoin price appears to have caught many BitMEX traders off guard. The volatility in price has caused the liquidation of around $157 million worth of trades.
The previous largest day for liquidations in 2020 was on January 20. At the end of January 19, the bitcoin price dropped by more than $400 in a matter of minutes. That too saw around $150 million suddenly change hands.
According to data taken from CryptoMeter.io, Wednesday saw more than $151.9 million worth of long traders wrecked and just $5.1 million worth of short traders.
Add a strong likelihood of leverage being used into the mix and the carnage only intensifies.