Binance Closes in on Deal with DOJ to End Compliance Monitorship

Binance is close to a deal with the DOJ to end its three-year compliance monitorship, imposed as part of a plea deal for AML and sanctions violations. The deal includes Binance stepping up its compliance reporting. The compliance monitor, Forensic Risk Alliance, was selected to maintain access to Binance's internal documents and review its compliance policies. Binance agreed to pay over $4 billion in fines and CEO Changpeng Zhao stepped down and served time in prison as part of the deal.

The second week of September saw the Altcoin Season Index reach its highest level in five years, driven by positive sentiment and increased open interest. However, this surge in activity also brought significant liquidation risks for several altcoins, particularly Ethereum (ETH), Binance Coin (BNB), and MYX Finance (MYX). This article explores these risks and the potential implications for investors.

Ethereum (ETH)

Ethereum (ETH) has seen a surge in long liquidations, with over $8.8 billion in long positions at risk of being liquidated if the price falls to $4,046 this week. Conversely, if ETH reaches $5,000, about $4.8 billion in short positions could be liquidated. This extreme leverage is fueled by traders' bullish expectations, with some analysts predicting a price of $5,000 or higher 3 Altcoins at Risk of Major Liquidations in the Third Week of September^[1].

Adding to the downside risks, Ethereum's profitable supply recently hit 99.68%, signaling potential profit-taking, and over 2.6 million ETH are queued for unstaking, reflecting stronger demand for profit-taking 3 Altcoins at Risk of Major Liquidations in the Third Week of September^[1]. These factors suggest that ETH could be vulnerable to price corrections.

Binance Coin (BNB)

Binance Coin (BNB) has also seen a surge in open interest, with total OI hitting $1.72 billion as of September 14. This figure is notable because previous surges in OI have triggered corrections of 7% to 15% in the current quarter 3 Altcoins at Risk of Major Liquidations in the Third Week of September^[1]. If history repeats, the third surge could lead to losses for traders holding BNB longs.

Like ETH, BNB's liquidation map shows an imbalance between long and short positions. More than $189 million in long positions could be liquidated if BNB falls to $818 this week, while about $103 million in short positions could be wiped out if BNB climbs to $1,031 3 Altcoins at Risk of Major Liquidations in the Third Week of September^[1].

MYX Finance (MYX)

MYX Finance (MYX) delivered a controversial 450% rally in September but has since cooled, with the token dropping from its ATH of $18.9 to $10.9, a more than 40% decline. The 7-day liquidation map shows that shorts face heavier losses if MYX recovers to $12.35, while long positions could be liquidated if MYX falls to $8.79 3 Altcoins at Risk of Major Liquidations in the Third Week of September^[1].

Some technical analysts expect a rebound, predicting that the $10–$11 range is a strong support zone where investors are likely to buy 3 Altcoins at Risk of Major Liquidations in the Third Week of September^[1]. However, BeInCrypto's latest analysis suggests that the current pullback is not a trend reversal but a temporary correction.

Conclusion

As the third week of September approaches, investors should be aware of the liquidation risks associated with Ethereum, Binance Coin, and MYX Finance. The extreme leverage and open interest seen in these altcoins suggest that price corrections could be significant if the market sentiment shifts. Traders should closely monitor these developments and adjust their strategies accordingly.

References

3 Altcoins at Risk of Major Liquidations in the Third Week of September^[1] https://beincrypto.com/altcoins-at-liquidations-risk-in-mid-september/