More than $500 million of long positions in Ether (ETH) could be liquidated if the price of Ether repeats last weekend's volatility.
This comes amid growing concerns that the U. S. Securities and Exchange Commission (SEC) may reject a proposal to create an #ETF on Ether next month.
According to CoinMarketCap, Ether is currently trading at $BTC Over the past few weekends, the price of Ether experienced brief volatility before quickly recovering to key support levels.
On April 20, the price briefly fell 2.25% to USD 3,036. On the Saturday before, April 13, the price fell nearly 9% to USD 2,950 before recovering to USD 3,075.
If the same thing happens again this weekend, there is a risk of a significant number of liquidations: according to CoinGlass, a drop of just 2.25% at current prices would result in USD 510 million worth of long positions being liquidated.
A sharp drop of 9%, such as that seen the previous weekend, would wipe out $853 million in long liquidations.
The possibility of mass liquidation comes as #ethereum suffers from uncertainty over the status of spot ETFs and other legal issues.
On April 24, Cointelegraph reported that U. S. issuers and other companies expect the SEC to reject an application for an Ethereum spot ETF next month after meetings with regulators in recent weeks, citing four people involved in the meetings.
According to the four officials, the recent meeting between issuers and the SEC was one-sided and SEC staff did not discuss key details of the proposed product.
Meanwhile, it was reported Thursday that Consensys filed a lawsuit against the SEC and five of its members for allegedly planning to regulate #ETH as a security.
This article does not contain investment advice or recommendations. Any investment or transaction involves risk and readers should do their own research when making a decision.
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