3 Altcoins Facing Liquidation Risks in the Third Week of December
1. Solana (SOL)
The 7-day liquidation heatmap for SOL shows that the potential liquidation volume of short positions is twice that of long positions.
Specifically, if SOL rises to $147 this week, traders holding short positions could suffer losses of up to $1 billion. In contrast, if SOL falls below $120, long traders could face liquidations worth around $500 million.
Several factors suggest that traders should be cautious when holding short positions this week.
First, SOL ETFs recorded seven consecutive days of positive inflows last week. Notably, the Bitwise SOL ETF has maintained positive inflows for 33 straight days since launch. It currently holds more than $600 million worth of SOL. This trend indicates sustained institutional demand.
2. Cardano (ADA)
Similar to SOL, overall negative market sentiment has encouraged short-term ADA derivatives traders to increase capital allocation and leverage on short positions.
This behavior has significantly increased the total short liquidation volume. If ADA rises to $0.45 this week, short positions could incur losses of up to $50 million. Conversely, if ADA drops to $0.35, long positions could face liquidations of around $19.5 million.
One key factor that ADA short traders should consider to reduce risk is the positive sentiment surrounding the Midnight project.
Midnight Network is a new blockchain developed by Input Output Global (IOG), the company behind Cardano, founded by Charles Hoskinson.
3. PIPPIN
PIPPIN is a meme coin that gained significant attention towards the end of the year. Its market capitalization surged from below $60 million to over $350 million in just three weeks.
The liquidation heatmap indicates that cumulative potential long liquidations remain higher than those of short liquidations. This data suggests that many short-term traders still expect prices to continue rising.
