Recent analysis of on-chain data indicates that almost $100 million in ether (ETH) positions are vulnerable if the price experiences a 15% decrease.
Asian traders encountered a challenging day on Monday as the global repercussions of former U.S. President Donald Trump’s tariff policies were felt widely.
According to data, ETH dropped nearly 16% on Monday, trading above $1490, while the broader CoinDesk 20 index fell 13%. Market participants are concerned that the U.S. market opening could exacerbate the situation.
If the U.S. market open leads to an additional 15% decline in ETH’s price, dropping it below $1,274, over $100 million in leveraged positions may be at risk of liquidation.
Liquidations on-chain can have more profound effects than those involving derivatives since they entail the selling of actual assets in the market. For instance, when a position is liquidated in MakerDAO, it gets auctioned off at a lower price to traders who can then resell at a higher price, which increases market supply and intensifies selling pressure.
A particular wallet that could face liquidation at $141 had several near misses on Monday but managed to reduce its ETH holdings and repay some of the DAI it was owed.
Data also suggests that if ETH falls by 20%, another $36 million could be at stake.
The largest individual ETH position, with $147 million in collateral locked, has a liquidation price set at $1,132.
Diving deeper, lending protocols were among the most affected tokens during Monday’s trading in Asia, as data indicates a 17% drop in the category amid growing concerns about the leverage surrounding certain positions.