NEW YORK, February 29, 2024 - On Wednesday, Bitcoin’s (BTC) impressive rally took a sharp turn, plummeting 7% from a high of $64,037 to a low of $59,400, causing significant disruption for leveraged traders. Earlier in the day, BTC had surged past $60,000 for the first time since November 2021, but the subsequent drop led to a volatile trading session, with the price briefly recovering to $61,122 before falling again.

This downturn had a broad impact on the digital asset market, with the CoinDesk 20 Index (CD20) falling nearly 5% from it's all-time high of 2,260. Major cryptocurrencies such as ether (ETH), Solana's SOL, XRP, Cardano's ADA, dogecoin (DOGE), and Avalanche's AVAX experienced declines of 4%-9% within an hour.

The price drop led to $700 million in liquidations across the crypto market over the past 24 hours, affecting both long and short positions in leveraged trading. This liquidation event is one of the largest since August of the previous year, when a sudden Bitcoin drop to $25,000 resulted in $1 billion in liquidations.

In the midst of this volatility, trading volumes for U.S.-listed spot Bitcoin ETFs hit new records. BlackRock's IBIT saw $3.3 billion in shares traded, more than double the volume from the previous day. Total trading volumes for spot ETFs approached $8 billion, according to Bloomberg Intelligence. Additionally, some Coinbase users reported issues with zero balances in their accounts, which the company has since addressed.