Chip-stock bets lost $52 million in 10 minutes with Wall Street shut
Traders betting on semiconductor stocks via perpetual futures on crypto exchanges lost $52 million in ten minutes during a weekend market shutdown. Because traditional stock markets were closed, the price action was driven entirely by automated liquidations and speculative trading on crypto platforms.
Why it matters
It highlights the extreme volatility and risks associated with 'synthetic' stock trading on crypto platforms, where lack of liquidity can trigger cascading forced liquidations.
Those bets were placed through perpetual futures, contracts that track a stock’s price and trade around the clock on crypto exchanges, so traders can buy and sell chip stocks on a Saturday night.
A trader who borrows to make a bigger bet gets closed out automatically when losses eat through their deposit, and the forced selling can push prices lower for the next trader in line.
About $51.6 million in positions tied to chip stocks and semiconductor funds were force-closed between 21:22 and 21:32 UTC, according to CoinGlass data, and about $38 million of that came from traders betting on higher prices.
SOXL, a fund that triples the daily moves in chip shares, took the biggest hit at about $12.7 million. SanDisk and SK Hynix contracts followed at about $10.8 million each.
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