$460 Million Bitcoin long liquidated on OKEx

$460 Million Bitcoin long liquidated on OKEx

The largest liquidation in history went down yesterday when a $460 millions worth Bitcoin long position was called, bit the $420 millions worth was not filled.

According to report by an unnamed co-admin of trading platform, whalepool, the liquidation of some 950 Bitcoins was such a big order that for OKEx to sell them on the market,  it would effectively crash the market.

The liquidation did not get filled in the market and Therese now a $420 millions over hang in this weekly settlement period that impacts all three maturities on BTCUSD futures.

During this settlement period gives some 50% of their profits, so whipping out this $420 millions loss and maintaining OKEx's solvency.

As like wise 50% loss have not been seen since 2015, with questions raised as to why was the individual able to build such a huge position.

The Whalepool co-admin says
"The open interest of the quarterly contract is $800 million now and more than half of this amount in short positions has PNL {profit} that goes uncovered due to this bankrupt #1 contract holder trader."

So if you have 1 Bitcoin at a 20 laverage you would be trading with 20 Bitcoins. That means price has to move very little for you to loose your one Bitcoin and thus get called. At that point exchange automatically closes your position and sell your Bitcoin in a long position.

Someone has to buy that sell, however and as far as this 950 Bitcoin position is concerned, the market was moving too fast, so it did not get filled. That potentially means everyone has now to collectively pay this 950 Bitcoin, which so happens to be half of all open intrest of quarterly contracts..



Thanks regards,
Vinay Kumar.