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Monday, December 09, 2024, proved to be a tough day for the cryptocurrency markets, with the crypto economy shrinking by 6.31% in just 24 hours and $1.5 billion in crypto derivatives positions disappearing. Bitcoin (BTC) found itself suspended between $96,800 and $97,000 per coin, although it briefly fell to $94,249, triggering turmoil.
Bitcoin Crash Causes Altcoin Avalanche: Double-Digit Losses Hit the Crypto Economy
Bitcoin took a sudden nosedive after having remained at $97,748 per coin. Within moments, the price dropped to $94,249, leaving the top cryptocurrency struggling to regain ground in the $97,000 zone. The ripple effect of this price drop left the broader crypto market reeling, with many other assets taking even harder hits.
For example, while BTC saw a 3.5% drop as the dust cleared, ether (ETH) fell by 7%, and XRP plunged by more than 11%. Solana (SOL) fell 6.5%, Binance coin (BNB) declined 7.48%, and dogecoin (DOGE) lost 8.92%. Losses piled up across the market, with most digital assets suffering double-digit declines. Tokens like PNUT and DYDX faced brutal drops of 22% and 21%, respectively, while GALA saw their value reduced by more than 20% over the day.
The recent market turbulence highlights the fragility of crypto valuations, where rapid price swings can quickly erase gains and intensify traders’ losses. As altcoins bore the brunt of the cascade of liquidations, the event underscores the importance of risk management strategies in the derivatives market. Traders are reminded that volatility in digital assets remains a significant challenge.
This widespread slowdown serves as a stark reminder of the unpredictable forces at play in the crypto economy during bull runs. With liquidations rising and prices faltering, market participants face tough questions about long-term stability and speculative risks.
For now, the sell-off has left a scar that may influence trading behavior in the days to come, emphasizing caution over exuberance.
By 4:45 p.m. EDT on Dec. 9, bitcoin (BTC) had managed to return to $97,294 per coin, leaving other cryptocurrencies recovering from their deep losses following the events. A few minutes later, at 4:49 p.m. EDT, BTC was once again struggling to hold $97K.
Crypto Bloodbath: $1.5 Billion in Liquidations as Bitcoin Plummets to $94K was originally published in The Capital on Medium, where people are continuing the conversation by highlighting and responding to this story.