SEC's Hacked Tweet On Bitcoin ETFs Causes Massive Trader Losses, Over $220M Liquidated

The hacked tweet from the SEC announcing fake Bitcoin BTC/USD ETF approvals sent the market soaring on Tuesday, only to plummet minutes later when reality set in, resulting in a financial wipeout for thousands of traders.

Over $220 million got liquidated in the resulting chaos, marking the second-biggest wipeout event of the year so far.

More than 70,000 traders felt the pain of liquidations, as the price swung wildly in both directions, according to data from Coinglass.

Bitcoin took the biggest tumble, and guess who got burned the worst? Long-position holders, to the tune of $133.5 million, versus just $87.29 million for short positions.

What was the single biggest liquidation? A $6 million Bitcoin order was swallowed whole on ByBit, adding to that exchange's $36.66 million total carnage. Market leaders Binance and OKX weren't far behind, with $83.88 million and $73.97 million in liquidations, respectively.

Also Read: Market-Moving SEC Twitter Hack On Bitcoin ETFs 'Unacceptable': Senate Banking Committee Member

Nicky Gomez, Senior Partner at XReg Consulting, a public policy and regulatory affairs consultancy specializing in crypto assets told Benzinga that the approval of the BTC ETFs will see new institutional and retail money flow into crypto, increasing the liquidity and price of Bitcoin, which is ultimately good for the market.

"However, it is just another example of crypto becoming more centralized and moving further away from its true value and potential. Ultimately, this will spur a larger divide among the crypto purists," he said.

Asked how approval of the Bitcoin ETF moves the cryptocurrency further away from its original purpose, he said the Bitcoin ETF will encourage greater speculation on the price of BTC from a broader audience, but it will be a distraction to the adoption of BTC for what it was originally designed for, a peer-to-peer payment network outside the traditional financial system.

Read Next: Crypto Bear Predicts Spot ETF Will Spark Rallies Before 'Massive Correction' For Bitcoin, Ethereum

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