Bitcoin return to $71K would wipe $1.38B shorts

Bitcoin's Price Drop Triggers Liquidation Concerns

Should Bitcoin (BTC) rebound to $71,000, a significant number of short positions could face liquidation, resulting in a potential billion-dollar wipeout.

Market Update

On June 7th, Bitcoin experienced a 3.33% dip to $68,507, later recovering above $69,000 amidst economic uncertainty stemming from the US Employment Situation Summary Report. The decline was accompanied by drops in several altcoins, including Ether (ETH), Solana (SOL), Dogecoin (DOGE), and Pepe (PEPE).

Liquidation Calculations

According to CoinGlass, the market plunge wiped out $409.51 million in short and long positions. Of this, $56.71 million was in long Bitcoin positions.

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If Bitcoin returns to $71,000, approximately $1.38 billion in short positions would be liquidated.

Investor Sentiment and Expectations

Prior to the price decline, Bitcoin had fluctuated between $70,000 and $71,662, raising hopes of a climb towards its all-time high of $73,679. However, futures traders anticipated further price declines, resulting in the liquidation of $1.38 billion in long positions.

ETF Impact Concerns

Investors have questioned why Bitcoin's price has not surpassed its previous highs despite significant inflows into Bitcoin ETFs. Analysts have suggested that ETFs currently lack the influence to drive the market on their own. Crypto trader Christopher Inks emphasized the complex nature of the market, which includes spot, futures, ETFs, and options.