Bitcoin Pumps Above $63K, Prompts Liquidations Worth Over $74 Million
Bitcoin has reacted positively to the Fed’s decision to reduce interest rates on Wednesday. Its bullish move, however, has not favored all traders, as some with short positions have been liquidated in the past 24 hours.
Bitcoin Rallies 10.7% This Week
CoinGecko’s data shows Bitcoin, the largest cryptocurrency by market cap ($1.25 trillion), trading at $63,657 after rallying 2.5% in the past day. The coin has added 10.7% to its value this week.
Meanwhile, CoinGlass reports that BTC’s sudden uptrend has led to liquidations worth more than $74 million since Thursday. Furthermore, the company says short traders who had positions in other cryptocurrencies have collectively lost nearly $79 million.
For starters, short positions are those opened by crypto traders who believe that the price of a particular digital currency will go down in the near future. If the crypto’s price goes up, and the traders lack sufficient margin, their positions get liquidated.
The Fed’s Rate Cut
As mentioned, Bitcoin and other top cryptocurrencies are rallying due to the Fed’s rate cut. On Wednesday, the American central bank decided to slash interest rates by 50 bps after increasing them to a 22-year high in 2022. Since the decision, risk-on assets like Gold and Bitcoin have seen significant gains. But why is that? Several analysts say risky investments tend to perform exceptionally when interest rates are low.
It is worth pointing out that Bitcoin’s current bullish trend is against the historical data, which shows that September has been a bad month for BTC in the past ten years. The data indicates that Bitcoin has posted an average monthly loss of 4% since 2014 but has rallied significantly in October and November.
Bitcoin’s Bullish Moves Prompt Marketwide Rally
All the top ten cryptocurrencies are in the green as of this writing. Data from CoinGecko shows BNB has recorded 24-hour gains of 2.7% and now trades at $571. Solana, on the other hand, is up 8.2% to $150. Notably, it has surged 11% this week. Meanwhile, Ethereum and Dogecoin are up 4.6% and 2.3% to $2,544 and $0.1067, respectively.
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