Crypto Market Sees $1.2 Billion in Liquidations as Bitcoin and Ethereum Tumble
The cryptocurrency market faced another brutal downturn, wiping out nearly $1.2 billion in leveraged positions within 24 hours as both Bitcoin and Ethereum plunged sharply. The steep decline triggered widespread liquidations, echoing a familiar pattern that has recently shaken the derivatives sector.
On Friday, Bitcoin’s price nosedived back to $104,200 after a short-lived bounce to $116,000 earlier in the week. This rebound, initially interpreted as a sign of possible market stabilization, has been exposed as a classic “dead cat bounce” — a temporary recovery followed by further losses. Bitcoin’s price dropped over 6% in just one day, while alternative cryptocurrencies suffered even more. Ethereum declined nearly 9%, falling to around $3,700.
The fallout extended deep into the derivatives market. According to data from CoinGlass, a total of $1.18 billion in leveraged positions were forcibly closed as traders’ margin thresholds were breached. These liquidations were overwhelmingly concentrated on the long side — bullish bets that prices would rise — which accounted for approximately $917 million, or 77% of the total.
Bitcoin alone was responsible for more than $431 million in liquidated contracts, making it the hardest-hit asset in terms of absolute value. Ethereum followed with $267 million in liquidations, while Solana came in third with $89 million. Interestingly, XRP saw only $27 million in liquidations despite its larger market capitalization and similar volatility, hinting at lower speculative activity in the asset compared to its peers.
Beyond the raw numbers, market dynamics also suggest institutional players may be contributing to the downward pressure. Analysts observed a shift into negative territory on the Coinbase Premium Gap, which measures the price difference between Bitcoin traded on Coinbase (USD) versus Binance (USDT). A negative premium indicates stronger selling on Coinbase — a platform more commonly used by U.S.-based institutional investors. This suggests that large entities may be offloading their holdings, further intensifying the sell-off.
The current wave of liquidations is not an isolated event. It follows a series of volatile sessions that have crushed over-leveraged traders. Last week also saw over $1 billion in liquidations as markets reacted to macroeconomic uncertainty, regulatory developments, and shifting investor sentiment.
Some analysts are framing the correction as a “controlled pullback” rather than a full-blown collapse. They believe that after months of bullish momentum, markets are undergoing a natural reset. However, others argue that the technical structure of Bitcoin appears “broken,” with bears now targeting levels as low as $75,000 if downward pressure persists.
Adding to the bearish outlook is a noticeable uptick in Bitcoin miner activity. On-chain data indicates that miners are transferring large amounts of BTC to exchanges like Binance, typically a precursor to selling. This behavior often signals that miners are preparing to liquidate their holdings, which can exacerbate downward movements in price due to increased supply.
Meanwhile, regulatory uncertainties continue to loom over the mining sector. Countries such as Laos have announced plans to phase out crypto mining by early 2026, citing environmental and policy concerns. Such developments place further stress on miner profitability and may prompt more sell-offs in the near term.
The broader altcoin market also remains under pressure. Traders are pulling capital out of riskier assets in favor of liquidity or stablecoins, reflecting heightened fear and uncertainty. This capital rotation has led to further bleeding in mid-cap and low-cap tokens, which tend to be more volatile during market downturns.
Despite the bearish sentiment, some market participants see the ongoing correction as a buying opportunity. Historically, sharp drawdowns have often preceded major rallies in the crypto space. However, the timing of such bounces is notoriously difficult to predict, and entering the market too early can lead to painful losses.
In the short term, attention will remain fixed on key support levels for Bitcoin and Ethereum. Should these levels hold, a period of consolidation may follow. However, a further breakdown could accelerate the decline, triggering another wave of liquidations and panic selling.
For now, traders are advised to approach the market with caution. High volatility, uncertain macroeconomic conditions, and unpredictable regulatory moves continue to define the landscape. Risk management, including the use of stop-loss orders and conservative leverage, is more critical than ever in navigating this treacherous phase of the crypto cycle.