Sudden Bitcoin Crash Shakes the Crypto Market

Bitcoin experienced a dramatic crash on August 5th, with the price dropping by 10% from $58,350 to a low of $52,500 in less than two hours. Currently, Bitcoin (BTC) is trading at $53,440 after a slight recovery, according to data from CoinMarketCap. This sudden price correction marks the first time since February 26th of this year that Bitcoin has fallen below the $53,000 mark. The previous plunge occurred before a surge triggered by the approval of spot Bitcoin ETFs in the United States. The drastic decline has led to substantial liquidations across the entire cryptocurrency market. According to data from CoinGlass, over $740 million in leveraged positions were liquidated in the past 24 hours, with leveraged long positions alone accounting for over $644 million. Specifically, long positions worth over $256 million in Ether (ETH) were liquidated, while Bitcoin longs worth $231 million were forcibly closed. This can be attributed to the significant rise in open interest in ETH over the past few months as traders sought to increase their exposure to the asset class before and after the approval of spot Ether ETFs in the U.S.