Bitcoin Leveraged Longs At Historic Records

This chart of BTCUSDLONGS represents the total number of Bitcoin held in margin positions on the exchange Bitfinex. This is only the data for one exchange but I make the assumption that as a data point it represents the state of the trading ecosystem as a whole. What this data shows is that despite the drop in price (or rather because of it) traders have been apeing into the dip with larger amounts of leverage than ever seen before. This could mean one of two things:

• Traders using high amounts of leverage will get rewarded for taking on high risk if the price rebounds
  
• Traders using high amounts of leverage will be liquidated and create an even more rapid cascade of price decline if the price continues to fall
  

Time will tell... do these traders taking on excessive risk get to win? Another question: if so many people are buying to DCA and/or speculate... why is price falling?

Comment:

These charts represent Bitcoin price (top) and Longs * BTCUSD (bottom).

The nominal amount of Bitcoin held on leverage is still very, very high. The nominal amount has fallen recently but only due to price decline. Liquidations from all the leverage taken from May 2022 onward do not seem to be happening yet.