While bitcoin has hit a new all-time high in 2021, traders are suspicious of going short of crypto assets. Data from Bitfinex shows that the number of short contracts is extremely low compared to the total number of shorts in mid-March 2020. On Saturday, January 2, 2021, when the price of bitcoin exceeded $ 33k, more than $ 100 million in short positions were closed within a few wound up in minutes.
On Saturdays, during the afternoon trading sessions (EST), bitcoin (BTC) reached $ 33,333 each. The price has been high for a lifetime, in terms of fiat value, over the course of the crypto asset’s 12 years of existence. Bitcoin’s value has also skyrocketed since March 12, 2020, also known as’Black Thursday. Since that day, the price has been BTC is up more than 777%, surpassing almost every asset under the sun, in addition to a few other crypto assets.
Liquidation Short on XBTUSD: Buy 10,000,000 @ 30864 🏅🏆💯💯💯💯💯💯💯💯💯💯💯💯💯💯💯💯💯💯💯💯💯💯💯💯💯💯💯💯💯💯💯💯💯💯💯💯💯 💯💯 💯💯💯💯💯💯💯💯💯💯💯💯💯💯💯💯💯💯💯💯💯💯💯💯💯💯💯💯💯💯💯💯💯💯💯💯💯💯💯💯 ~ I am shocked, shocked at that to discover gambling is going on here!
– REKT (@BXRekt) January 2, 2021
As bitcoin has skyrocketed in value, traders have been unwilling to go short on crypto assets since mid-March. For example, on the Bitfinex exchange, the number of short contracts decreased 77% since mid-March 2020. This promotion can be seen on many other cryptocurrency exchanges, including Bitmex, Bybit and other platforms offering margin and leverage trading. Across the board, short contracts have fallen significantly.
#bitcoin shorter like
OH NO OH NO OH NO NO NO NO NO
– CryptoKid (@mancryptodude) January 2, 2021
Despite the lower activity of short contracts on Bitfinex, the number of long contracts has not increased much either. In fact, as of April 2020, the number of long contracts hosted on the platform is down, too plummeted. The shorts and longs remain fairly low, suggesting traders are unsure of how to place their bets in line with the future BTC Prices.
Meanwhile, those traders who are willing to go bitcoin short are (BTC) during this impressive bull run, they often lost their shirts on the way up. An example is when BTC Hitting the all-time high of $ 20k two weeks ago, around 74,000 short positions were liquidated that day. At the time the derivatives exchange Bybit’s liquidation data explained that it saw a whopping $ 1 billion in liquidations and that about 98% of trades went short.
Today’s rise above the $ 33k price zone has been no different like 78,107 merchants were liquidated according to Bybit data on Saturday. The largest liquidation order took place on Bitmex-BTC This Morning (EST), worth about $ 10 million. More than $ 800 million contracts were liquidated during the last 24 hours of crypto trading.
The popular Twitter account called ‘Rekt’ recorded the $ 100 million in liquidations at $ 30,864 per unit price. “Settled Short on XBTUSD: Buy 10,000,000 @ 30,864,” Rekt tweeted. “I am shocked, shocked to find out that gambling is done here,” he added.
What do you think of the lower activity of bitcoin shorters and the liquidations after bitcoin’s all-time highs? Let us know what you think about this topic in the comments below.
Image Credits: Shutterstock, Pixabay, Wiki Commons, Bybit Data, Twitter,
Disclaimer: This article is for informational purposes only. It is not a direct offer or invitation to an offer to buy or sell, or a recommendation or endorsement of products, services, or companies. Bitcoin.com does not provide investment, tax, legal or accounting advice. Neither the company nor the author is responsible, directly or indirectly, for any damage or loss caused or alleged to be caused by or in connection with the use of or reliance on any content, goods or services mentioned in this article.