Bitcoin Cash Futures Traders Devastated As Prices Soar To $320!
- Traders lost over $25 million betting against Bitcoin cash as the price spiked to $320. Negative funding rates indicate short traders are dominant, with short interest in the tokens rising. Large liquidations may signal the local top or bottom of a steep price move.
- Increased BCH trading volumes on South Korean exchanges and the launch of the new exchange, EDX Markets, contributed to the sudden spike.
- Last week’s moves are likely to have come amid the launch of EDX Markets, backed by traditional finance heavyweights Fidelity Digital Assets, Charles Schwab, and Citadel Securities, which supports BCH along with BTC, ETH, and LTC.
Bitcoin cash (BCH) lost the highest amount in over two years last week as the price spiked to the $320 level.
Shorts and longs together lost more than $25 million on Bitcoin cash-tracked futures, which may have contributed to the sudden spike. To be more specific, shorts refer to bets against any asset, while longs are bets on price rises.
Interestingly, funding rates across all exchanges that list Bitcoin cash futures have fallen negative since Monday. This indicates that short traders are dominant and are willing to pay long traders to remain in their positions. In fact, Bitcoin cash traders are now paying funding rates of as much as -0.05% every 8 hours in fees to exchanges, which implies that short interest in the tokens is rising.
Liquidation is a term used when an exchange forcefully closes a trader’s leveraged position due to a partial or total loss of the trader’s initial margin. It happens when a trader is unable to meet the margin requirements for a leveraged position or fails to have sufficient funds to keep the trade open. Large liquidations can indicate the local top or bottom of a steep price move, which may allow traders to position themselves accordingly.
Last week’s BCH trading volumes on South Korean exchanges increased significantly, and the launch of EDX Markets, a new exchange backed by traditional finance heavyweights Fidelity Digital Assets, Charles Schwab, and Citadel Securities, which supports BCH along with bitcoin (BTC), ether (ETH), and litecoin (LTC), may have played a role in the recent price spike. It’s important to keep an eye on funding rates, liquidation, and trading volumes to predict the future price movement of BCH and other cryptocurrencies.
DISCLAIMER: The Information on this website is provided as general market commentary and does not constitute investment advice. We encourage you to do your own research before investing.
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