However, recent on-chain and futures market statistics indicate that the top cryptocurrency by market capitalization has begun to show indications of improvement. The futures market is showing signs of returning to equilibrium following a flurry of short liquidations. Data from Glassnode shows that short position liquidations removed unhealthily speculative market participants and that on-chain and exchange data now indicate increasing spot market and exchange net flows.
Bitcoin’s Latest Market Statistics Pose A Good Sight For The Cryptocurrency
Glassnode experts classify this vast group of investors who were previously losing money as having “unrealized profits.” Longs and shorts are frequently in equilibrium in futures data. Investors typically update their futures as the market changes to prevent liquidation. On the other hand, investors were caught off guard in mid-January, which led to an all-time high of 85%.
Longs and shorts are frequently in equilibrium in futures data. Investors typically update their futures as the market changes to prevent liquidation. In contrast, investors were taken off guard in mid-January, which led to an all-time high of 85% short liquidations. The recent Bitcoin rise has been aided by the prevalence of short liquidations. Over $495 million in short futures were liquidated in January.
Short positions that have been liquidated trigger automatic Bitcoin purchases, raising the price of BTC. Three significant waves of liquidations have taken place so far this year, reaching a peak of $165 million in a single day. The futures market is moving in the direction of longs after the historically high number of short liquidations. On January 30, 51.46% of open positions are long positions as opposed to short positions.
Centralized exchange (CEX) Bitcoin balances reached a record high in March 2020. After that, Bitcoin started to leave spot exchanges. A multi-year low of 2.25 million BTC is now held across 21 of the largest exchanges. The last time this happened was in February 2018, when centralized exchanges held 11.7% of the entire Bitcoin supply.
