Drop In Value And the Current Speculation | bitcoin magazine

Margin Trading Was The Cause?

Some theorize there are whales (people with large enough funds that they can make the market shift noticeably) who are pushing (selling lots of Bitcoins) through margin calls.

Margin calls is an element of margin trading. A margin trader can deposit funds in a specified account with a related business – in this scenario, digital currency exchanges. Or specifically some have mentioned Bitfinex.

Once a margin trader has deposited her or his funds they receive percent of it back as credit. For example, you deposit $5,000 in Bitcoin and you would have your account credited the $5,000 and then another $5,000 (in a chosen denomination).

This credit would allow you (as a margin trader) to place bigger sell and buy orders than you normally would, creating liquidity on an exchange and attract more customers.

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