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The sharp decline that began Thursday evening continued, with the price of Bitcoin ($BTC) falling to its lowest level in nine months, reaching $81,000.
This situation increases the risk of further declines, creating an unusual scenario.
Accordingly, Bitfinex’s leveraged long positions in Bitcoin reached 83,933 $BTC (approximately $7.3 billion), the highest level since November 2023.
What Does This Mean for Bitcoin?
$BTC long positions on Bitfinex reached a two-year high just before a sharp sell-off in stocks and cryptocurrencies.
Generally, when prices fall sharply, leveraged positions are reduced to avoid the risk of forced liquidation.
However, the opposite happened. Despite Bitcoin falling by approximately 26% in the last 90 days, bullish long positions increased. Instead of decreasing, long positions jumped to a two-year high, moving in the opposite direction of the price.
In addition, demand for leveraged trading increased, but it failed to reverse the downward trend in Bitcoin.
While the increase in leveraged long positions at this point suggests an upward trend, it also increases the risk of a larger correction if leverage reduction continues and accelerates.
According to analysts, the increase in leveraged long positions is difficult to interpret as a sudden price jump or a bull market signal, given factors such as the downward trend since October and other bearish indicators.
*This is not investment advice.