Commenting on the falling cryptocurrency prices, SMU Associate Professor of Finance Emiliano Pagnotta said forced sales pushed prices lower, triggering more liquidations in a feedback loop that cascaded through the market. Assoc Prof Pagnotta added that the people who liquidate first trigger further price movements, which creates escalation: the liquidation cascade. He noted that in combination with the thin liquidity of most crypto tokens, this can create a disaster scenario.
