If Bitcoin manages to bounce back swiftly from its recent drop to $71,000 on June 6, more than a billion dollars in short positions will be liquidated.
Bitcoin (BTC) experienced a 3.33% decline on June 7, falling to $68,507 before recovering slightly above the $69,000 mark amidst broader macroeconomic uncertainty triggered by the United States Employment Situation Summary Report, which reported higher job growth than anticipated in May.
In addition to Bitcoin’s price drop, Ether (ETH) also saw a 3.58% decrease over 24 hours, while other altcoins like Solana’s (SOL), Dogecoin (DOGE), and Pepe (PEPE) suffered declines of 5.61%, 8.70%, and 9.99% respectively, according to CoinMarketCap data.
The market downturn resulted in a total wipeout of $409.51 million in short and long positions, with $56.71 million in long positions specifically for Bitcoin, according to CoinGlass data. If Bitcoin reaches $71,000 again, approximately $1.38 billion in short positions will be liquidated.
Prior to the drop in Bitcoin’s price, it had been hovering between $70,000 and $71,662 on June 5 and 6, with many traders optimistic about it nearing its all-time high of $73,679.
Currently, traders are more inclined towards shorting Bitcoin, indicating a belief that the price may not recover as quickly. If Bitcoin reaches $71,000 again, $1.38 billion in long positions will be wiped out, suggesting that futures traders are anticipating further price decreases.
The recent discussions around Bitcoin’s price not surpassing its March all-time highs despite a 19-day streak of positive inflows into Bitcoin exchange-traded funds (ETFs) have left investors curious. Analysts have pointed out that various factors influence Bitcoin’s price, and ETFs alone may not be strong enough to drive significant changes in the market.
Charles Edwards, the founder of Capriole Investments, highlighted that while ETF flows are positive, they may not be powerful enough to outweigh selling pressure from the entire ecosystem. Crypto trader Christopher Inks emphasized that the market comprises spot, futures, ETFs, and options, all of which play a role in determining Bitcoin’s price movements.