The Bitcoin crash led to the liquidation of $8.7 billion in positions

This article is from the public account Block unicorn, authored by Mr. Unicorn.

According to data from Bybt.com, the total liquidation amount in the crypto market exceeded $8.7 billion in the past 24 hours, with $3.7 billion being BTC trading positions. Ethereum trading positions lost over $2.3 billion. The severe volatility in the crypto market continues to harm leveraged traders, with about 90% of all liquidations coming from long positions. The largest liquidation order exceeded $70 million, and the Renaissance master Shakespeare feels sorrow for his misfortune. Within a week, the entire market capitalization evaporated by about $900 billion, clearing most positions, and it can be said with certainty that the upcoming cryptocurrency market will have better developments.

In fact, the story should begin with Grayscale, which declared on Twitter that it was shorting Dogecoin's father, DOGE. Elon Musk, the father of Dogecoin, responded to Grayscale: "Bitcoin will consume a significant amount of energy in the world, it's unsustainable." Subsequently, Elon Musk claimed that Tesla had stopped using Bitcoin for payments for Tesla electric vehicles, sparking endless debates on Twitter. However, negative news from domestic policies continued to spread throughout the market yesterday, causing severe damage to the 2021 bull market cycle. Since early February, Bitcoin has fallen below $40,000 in just the past 24 hours, signaling selling pressure, and bears took this opportunity to continuously apply selling pressure, causing BTC to drop to a low of $30,000.

(Source: My token)

In the midst of the plummeting market, the DeFi lending market was no exception and was severely impacted. According to DeBank data, due to the extreme volatility in Ethereum's price, the liquidation amount of lending protocols on Ethereum reached $256 million in the past 24 hours, setting a new historical high. Among them, the liquidation amount on AAVE V2 reached $116.3 million, ranking first, while Compound ranked second with $113.8 million. The total borrowing amount of lending protocols on Ethereum is currently $17.321 billion.

In the bleak market environment, people's emotions are panicked, prompting a large number of users to log into trading platforms to trade their holdings, causing congestion on trading platforms, applications failing to open, and connection issues. The largest crypto trading platform, Coinbase, also encountered such situations, unable to open the app. Coinbase officials added: "Please don't worry, your assets are safe." During every surge and plunge in the market, trading platforms like OKEX, Binance, Huobi, Bitpanda, FTX, Bitstamp, and Kraken often experience application lag, inability to open, and network connection failures, reminding you as if to say: "You cannot avoid the losses caused by the big market movements."

Centralized trading platforms frequently encounter errors during severe market fluctuations, preventing users from trading. They can only watch the alerts come in with trembling hands, unable to do anything, which is extremely cruel for users and can lead to significant losses. This is not the first time such incidents have occurred, and it is very unfriendly to users. Whether it is human manipulation or limited technical capabilities, if it is due to limited technology and difficult to resolve issues, the market will be led by Layer 2 DEX (decentralized exchanges) towards fair and healthy development.

Despite the current chaotic market, brave individuals undeterred by risk are stepping into the crypto market. Wells Fargo, once opposed to cryptocurrency and Bitcoin, plans to launch Bitcoin portfolios for its affluent clients. Over the past few years, Bitcoin's trajectory has been astonishing, moving from being ignored by traditional finance to gaining attention, becoming a hot topic among the general public.
Wells Fargo is like an old friend or classmate you haven't contacted for decades, suddenly messaging you to ask how to buy Dogecoin or SHIB. You are stunned for a moment, even wanting to laugh, as Wells Fargo has always opposed Bitcoin, and now it comes to tell you it wants to help you invest in Bitcoin.
While exploring the prospects of cryptocurrency, Wells Fargo's report also pointed out that as financial service giants have been seeking professional solutions and have entered the final stage of the crypto market, detailed investigations have been ongoing for months. All signs indicate that this exciting new initiative will launch in mid-June.

This is significant because Wells Fargo's investment management division manages nearly $2 trillion in assets, making it one of the largest asset management institutions in the U.S. Introducing digital assets like Bitcoin to such clients will be highly beneficial, not only increasing adoption rates but also injecting capital into the industry, representing the biggest positive news following this crash.

How to view this crash in relation to the future direction of the industry cannot be separated from the trends in the U.S. Yesterday, domestic news media frantically shared content related to policies, with some even titling it "China will indefinitely ban virtual currencies," a one-size-fits-all approach, reminding everyone of September 4, 2017, when the central bank, the Cyberspace Administration, the Ministry of Industry and Information Technology, the State Administration for Industry and Commerce, the China Banking Regulatory Commission, the China Securities Regulatory Commission, and the China Insurance Regulatory Commission jointly intervened to officially halt ICO financing. The notice from the seven departments stated that no organization or individual may illegally engage in token issuance financing activities, and all types of token issuance financing activities should be immediately stopped, leading to a market crash and plunging the entire market into silence.

Originally, in 2017, domestic blockchain technology held a major advantage in the Chinese market. However, following the September 4 policy, the blockchain industry was severely impacted, causing the once-thriving blockchain sector to hit rock bottom. Domestic blockchain technology companies could only survive cautiously, while foreign blockchain technology continued to innovate, with Ethereum being the most typical case, evolving into a unicorn.