Over the course of the weekend, trading in Dogecoin stock caused the Shiba Inu-themed meme coin to reach a market capitalization of more than $10 billion. Additionally, Dogecoin’s value has increased by more than 90% over the course of the past week, making it one of the largest liquidators among futures contracts that track crypto majors.
Since Friday, frenzied trading in dogecoin futures caused losses totaling over $89 million. This occurred at the same time that Elon Musk’s purchase of Twitter was made official. Short traders, often known as people who bet against an increase in a token’s price, were responsible for around $52 million of those statistics.
When an exchange forcibly cancels a trader’s leveraged position because of a partial or total loss of the trader’s initial margin, this is an example of a liquidation. Liquidations can also occur when a trader’s initial margin is completely lost. It takes place when a trader is unable to meet the margin requirements for a position that uses leverage (fails to have sufficient funds to keep the trade open).
In the past twenty-four hours, liquidations of dogecoin were the biggest among all cryptocurrencies, totaling almost twenty-seven million dollars. Futures tracking ether and bitcoin, which often see the highest values, chalked up a relatively lower $14 million and $12 million in losses respectively. Both of these statistics are lower than what is typically seen.
It is possible that the liquidations played a role in a short squeeze, as the price of dogecoin more than quadrupled from just under 7 cents on Friday to over 15 cents on Sunday morning. As of the time of this writing on Monday, prices have fallen to 11 cents.
As of Monday, there was around $647 billion worth of open interest in dogecoin futures trading. Open interest refers to the number of contracts that are currently active but have not yet been settled by an offsetting deal.
According to the data gathered by block explorers, the number of on-chain transactions performed on the Dogecoin network has skyrocketed from 25,000 per day over the previous week to over 37,000 as of Monday morning.
Because of Musk’s significant investment in DOGE, cryptocurrency has evolved into a stand-in for public opinion on him. As was previously noted, the statements that the entrepreneur has made on the cryptocurrency have also had a consistent influence on its price.
Featured Image- Pixabay @ KNFind