Sudden spike in Bitcoin price causes crypto liquidations to reach $285 million

Traders betting on a fall in Bitcoin are feeling the pain as the price of Bitcoin continues to soar. But so are those betting on rising prices.

The largest digital asset by market capitalization was rapidly approaching $68,000 per coin early Tuesday amid a sudden surge, according to CoinGecko. However, this increase did not last long and the increase was completely wiped out.

Bitcoin is currently trading just above $65,200 after hitting a daily high of $67,803 per data from CoinGecko. And on Coinbase, the largest U.S. cryptocurrency exchange, Bitcoin has fallen to less than $70 per coin, down from a previous price of $68,000.

Bitcoin's sudden rise is hurting futures traders who had shorted the currency or bet on its price falling. According to CoinGlass data, $130 million of short positions were liquidated across all cryptocurrencies in the past 24 hours.

However, the rally was followed by a sharp decline, and the liquidation of long positions has now actually exceeded short positions during this period, amounting to approximately $155 million. This brings the total of all assets in the last 24 hours to approximately $285 million.

This asset appreciation will come from investors putting money into newly approved exchange-traded funds (ETFs) that provide exposure to this coin. More than $556 million hit U.S. investment vehicles on Monday, the largest inflow for the first week of June.

Investors were similarly bullish last week, pouring about $419 million into bitcoin-related funds around the world in a week that rebounded following outflows the previous week.

Ethereum price also skyrocketed earlier today, hitting a high of $2,677 at 9 a.m. New York time. However, the second largest coin has since fallen and is currently trading at $2,560.

Analysts say all cryptocurrencies could benefit from a Republican presidential inauguration. Former President Donald Trump has clearly stated that he is a supporter of cryptocurrencies as he seeks to win a second term in the White House, but his Democratic rival and current Vice President Kamala Harris has We have just started sharing our crypto policy plans.

Edited by Andrew Hayward