Explore the ripple effect of Middle East tensions on crypto markets, the significant inflow into crypto funds, HTX hacker's ethical return, and Deribit's expansion.
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$100 Million in Liquidations Amid Middle East Conflict

$100 Million in Liquidations Amid Middle East Conflict

Explore the ripple effect of Middle East tensions on crypto markets, the significant inflow into crypto funds, HTX hacker's ethical return, and Deribit's expansion.

Date:
Oct 10, 2023
| Issue
#
122

Welcome to the first edition of Datawallet Daily for the week. Here are the key stories that are shaping the crypto landscape over the last 24 hours:

Before diving into how geopolitical unrest is affecting crypto and the latest stories of the day, let's take a quick look at market price action.

$100 Million in liquidations amid Middle East conflict

As Middle East tensions escalate, the crypto market felt the tremors with over $100 million liquidated this Monday. Data from CoinGlass spotlighted a harsh reality - $105 million in optimistic long positions were obliterated by the afternoon bell in the U.S., marking a significant blow since September 11.

The unfolding combat between Israel and Hamas cast a long shadow on digital assets. Bitcoin (BTC) retreated over 2% before recovering slightly to $27,600, while Ether (ETH) faced a near 5% dip. Other notable cryptocurrencies like Solana (SOL), Polygon (MATIC), and Polkadot (DOT) navigated through a 6% to 7% downslide, albeit with a mild recovery later.

Liquidations, an ominous event in trading, happen when futures exchanges shut down leveraged positions due to insufficient funds, causing a partial or total loss of the trader’s initial margin. The fallout was especially brutal for ETH derivative traders, with a staggering $32.78 million in long positions liquidated over 24 hours. The most substantial single hit was a $4.5 million ETH-BUSD long on Binance.

As geopolitical unrest continues to sway the crypto market, it's a stark reminder for traders of the market's vulnerability to global affairs, urging a cautious approach amidst the evolving financial landscape.

Crypto funds see largest inflows since July

According to data from CoinShares, digital asset investment funds experienced inflows totaling $78 million for the second week, marking the largest inflows since July. The majority of these inflows, amounting to $43 million, were directed towards Bitcoin investment funds. Additionally, the report stated that Bitcoin trading volumes increased by 16% in the previous week. CoinShares also highlighted that some investors allocated approximately $1.2 million to short positions on Bitcoin following its recent price surge.

HTX hacker returns funds

The individual responsible for the attack on the cryptocurrency exchange HTX (previously known as Huobi) on September 24th has returned the stolen amount of approximately 5,000 ETH, as indicated by data recorded on the blockchain.

The funds were given back through two separate transactions, one involving around 4,000 ETH and the other involving approximately 1,000 ETH. Justin Sun, an advisor for HTX and the founder of Tron, confirmed the successful recovery on X (formerly known as Twitter). He also mentioned that a "whitehat bonus" of 250 ETH ($400,000) was paid to the hacker.

Deribit to List XRP while seeking License in EU

Deribit, the top cryptocurrency options exchange in terms of trading volume and open interest, has unveiled its upcoming launch of options linked to well-known alternative cryptocurrencies XRP, SOL, and MATIC. Just before press time, the exchange disclosed its expansion strategy, revealing its intention to acquire a brokerage license within the European Union (EU). Options are financial contracts that grant the buyer the choice, but not the obligation, to buy or sell the underlying asset at a predetermined price on or before a specified date. A call option allows for buying, while a put option permits selling.

Other breaking news

Wrapping up

Wrapping up today's edition, we observed a ripple effect in the crypto market due to escalating Middle East tensions, with over $100 million in long liquidations. Despite this, crypto funds marked a significant inflow, the largest since July. On a positive note, the HTX hacker returned the stolen funds, showcasing a rare ethical turnaround in the crypto space. As the market navigates through geopolitical and internal challenges, these developments reiterate the dynamic and interconnected nature of the crypto ecosystem.