Bitcoin experienced a sharp decline this week, dropping over 10% with the largest cryptocurrency by market cap hovering around $68,860, amidst a broader market sell-off. This downturn was exacerbated by the liquidation of over $2 billion in leveraged crypto positions, and the collapse of Hong Kong hedge funds trading in BlackRock’s IBIT ETF options. The resulting sell-off exceeded what Bitcoin’s market fundamentals alone would suggest, with Parker White noting that a combination of leveraged trades and regional factors, including silver price shifts and yen-funded leverage, sparked the turmoil. Institutional involvement, facilitated by products like spot Bitcoin ETFs, contributed to intensified price swings, as large financial players adjusted their positions in the volatile market. South Korea’s regulatory tightening of crypto exchanges, triggered by a recent giveaway error at Bithumb, further reflects the increasing focus on oversight in the sector amidst these fluctuations.
Bitcoin crashes over 10% due to leveraged trades and hedge fund collapse
