SEC Lawsuit Shocks Crypto Market as SOL, ADA, and MATIC Tokens Plummet 20%
- Tokens of major blockchain networks slid more than 20% in the past 24 hours amid a likely risk-off event days after 13 tokens were alleged as securities in a U.S. Securities and Exchange Commission (SEC) lawsuit against crypto exchanges Binance and Coinbase.
- Such moves pushed weekly declines for these tokens to as much as 34%, the data shows.
- Crypto-tracked futures saw nearly $300 million in liquidations in the early hours on Saturday, data from Coinglass show, exceeding the nine-month record liquidation figures from earlier this week.
In the past 24 hours, SEC significant drop in the value of major blockchain tokens, with losses of more than 20%.
This slide is likely due to a risk-off event that followed the SEC’s lawsuit against Binance and Coinbase, in which 13 tokens were alleged as securities. This news has rocked the crypto world, with many questioning the future of these tokens in light of the lawsuit.
Interestingly, the bulk of the losses occurred in the early hours of Saturday, with Solana (SOL), polygon (MATIC), and cardano (ADA) falling as much as 25% within hours. This sudden drop has led some to speculate that a major crypto fund may have sold their holdings in these tokens, taking advantage of the illiquid market conditions.
The impact of this news has been far-reaching, with weekly declines for these tokens reaching as much as 34%. Even major tokens such as bnb (BNB), dogecoin (DOGE), and xrp (XRP) have not been spared, falling over 11%. In fact, the top two cryptocurrencies, Bitcoin (BTC) and ether (ETH), have also been impacted, with BTC dropping 3.6% and ETH sliding 4.5%.
As if this was not enough, we have also seen nearly $300 million in liquidations in the crypto-tracked futures market in the early hours of Saturday, according to data from Coinglass.
This figure exceeds the record liquidation figures from earlier this week. For those who may not be familiar with the term, liquidation refers to the process of forcibly closing a trader’s positions in the cryptocurrency market. It occurs when a trader’s margin account can no longer support their open positions due to significant losses or a lack of sufficient margin to meet the maintenance requirements.
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