Bitcoin falls below $54,000 as derivatives positions worth over $1 billion are liquidated

The price of bitcoin has fallen below $54,000 from nearly $58,500 on Sunday as derivatives positions worth more than $1 billion get force liquidated by crypto exchanges.

About $1.50 billion worth of open interest was liquidated by crypto exchanges in the last 24 hours, according to tracker In other words, crypto exchanges liquidated traders' overleveraged positions. 

Traders overleverage, or trade on margin, thinking that bitcoin's price would go up and they would benefit more. But when bitcoin's price goes below the liquidation price of their positions, exchanges force liquidate or close their positions because traders cannot fulfill margin requirements of their leveraged positions.

"In the past weeks, a lot of accumulation on the long side happened, so traders should expect such correction events," Bitfinex CTO Paolo Ardoino told The Block, adding that such corrections are "normal."


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Most of the liquidations occurred on Binance, followed by Huobi and Bybit. While in terms of crypto assets, bitcoin positions formed most liquidations, followed by ether (ETH) and XRP. 

Bitcoin is currently trading at around $53,400, according to tracker TradingView. Meanwhile, ETH is trading at about $1,775.

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Yogita Khatri is a senior reporter at The Block, covering all things crypto. As one of the earliest team members, Yogita has played a pivotal role in breaking numerous stories, exclusives and scoops. With nearly 3,000 articles under her belt, Yogita holds the records as The Block's most-published and most-read author of all time. Prior to joining The Block, Yogita worked at crypto publication CoinDesk and The Economic Times, where she wrote on personal finance. To contact her, email: [email protected]. For her latest work, follow her on X @Yogita_Khatri5.