Crypto Liquidations

Definition ∞ Crypto liquidations are forced sales of digital asset collateral in decentralized finance (DeFi) protocols or leveraged trading platforms. This occurs when the value of a borrower’s collateral falls below a predetermined threshold, triggering an automatic sale to cover the outstanding debt. Liquidations are a risk-management mechanism designed to protect lenders from losses due to asset price depreciation.
Context ∞ News about crypto liquidations frequently appears during periods of high market volatility, signaling significant downward price pressure and potential cascading effects within DeFi ecosystems. Understanding these events is vital for assessing market stability, the health of leveraged positions, and the systemic risks inherent in highly leveraged digital asset markets.

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→Market Dynamics

→Financial Markets

→Short Positions

Crypto Market Sees $267 Million Liquidated, Bitcoin Price Dips

The cryptocurrency market experienced substantial liquidations, causing Bitcoin's price to fall and signaling increased volatility for leveraged traders.

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→Leveraged Positions

→Crypto Trends

→Price Levels

Crypto Market Sees Sharp Drop and Quick Rebound amid Liquidations

Crypto market saw massive liquidations trigger a sharp dip, then quickly rebounded, showing resilience amid renewed optimism.

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→Currency Markets

→Investor Behavior

→Altcoin Losses

BoJ Rate Hike Signal Triggers Crypto Market Plunge

A potential Bank of Japan rate hike caused a crypto market crash as yen carry trades unwound and liquidity tightened, leading to massive liquidations.