2020 Liquidations: A Year of Store Closures and Bankruptcies

2020 was a tough year for many businesses, with a record number of store closures and bankruptcies. The retail industry was particularly hard hit, with over 12,000 stores closing in the United States alone.

One of the biggest factors contributing to the surge in liquidations was the rise of e-commerce. As more and more consumers turned to online shopping, brick-and-mortar stores struggled to keep up, leading to a decline in sales and ultimately, bankruptcy.

Some notable examples of businesses that filed for bankruptcy in 2020 include JCPenney, which filed for Chapter 11 protection in May, and Neiman Marcus, which filed for bankruptcy in May as well.

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The 2020 liquidations were a significant event in the cryptocurrency market. A total of about $1.9 billion in long liquidations occurred last March.

During the liquidation event, contracts across derivatives exchanges plummeted well below spot price. This presented a great entry point for opportunistic traders.

The March 2020 crash was a notable moment in the market's history, but the recent liquidation event eclipsed it with $3.4 billion in long liquidations.

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A historic weekend of liquidations occurred in the bitcoin market, with a selloff triggering a cascading number of liquidations across the derivatives market.

Open interest in bitcoin futures climbed throughout 2021, reaching an all-time high of approximately $24 billion before the selloff.

The aggregate amount of leveraged long liquidations eclipsed the notorious March 2020 crash, with $3.4 billion in long liquidations this past weekend.

Contracts across derivatives exchanges plummeted well below spot price during the liquidation event, with XBT/USD BitMEX contracts hitting as far as -3.02% below BTC/USD on Coinbase.

The price of bitcoin has since slightly recovered, retracing back to $55,400 at the time of writing from the weekend low of $51,300.

The liquidation event was triggered by a 9,000 BTC inflow to cryptocurrency exchange Binance.

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The Metrocentre, near Newcastle, was then the largest UK shopping centre with more than 270 stores, 2m square feet of selling space, 60 places to eat and a range of leisure attractions.

Nottingham companies ran coach tours from Nottingham to the Metrocentre, and they still do.

Lists of medium and large UK retailers that have gone bust have been published by our team for over 17 years.

The Metrocentre was seen as so wonderful that it attracted coach tours from other parts of the country, showing its significant impact on the retail industry.

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The 2020 liquidations were largely influenced by the COVID-19 pandemic, which led to a significant increase in business failures.

Many companies, particularly those in the retail and hospitality sectors, struggled to stay afloat due to government-imposed lockdowns and social distancing measures.

The pandemic accelerated the decline of several major retailers, including Arcadia Group, which filed for administration in December 2020.

Administrators were tasked with selling off the company's assets and finding new buyers to take over the business.

The UK's Insolvency Service reported a 33% increase in company liquidations in 2020 compared to the previous year.

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This surge in liquidations was largely driven by the pandemic's impact on the economy.

The UK's Corporate Insolvency and Governance Act, which came into effect in June 2020, provided temporary measures to help businesses affected by the pandemic.

These measures included a moratorium on winding-up petitions and a suspension of wrongful trading claims.

However, the Act did not provide a long-term solution for struggling businesses, and many were still forced to liquidate in 2020.

The liquidation process can be complex and time-consuming, involving multiple stakeholders and regulatory bodies.

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