Crypto Market Plummets: Bitcoin and Ethereum Trigger Nearly $600 Million in Long Liquidations
The cryptocurrency market has recently experienced a significant downturn, with Bitcoin, Ethereum, and other major digital assets seeing a sharp retreat over the past 24 hours. This sudden price action has triggered a massive long squeeze across derivatives exchanges, leading to substantial liquidations for traders betting on rising prices.
Market Turbulence Leads to Widespread Liquidations
According to data from CoinGlass, the recent market volatility resulted in an astonishing $650 million in liquidations across the derivatives sector. A "liquidation" occurs when a trader's leveraged position is forcibly closed by the exchange due to losses reaching a predetermined threshold, often magnified by the amount of leverage employed. Notably, approximately 90% of these liquidations—totaling around $584 million—were long positions, highlighting the severe impact on bullish traders caught off guard by the downturn. This indicates a significant correction as prices fell, forcing many leveraged "long" positions to unwind.
Ethereum Outpaces Bitcoin in Losses, Altcoins Feel the Heat
While Bitcoin often dominates market headlines, Ethereum took the lead in individual liquidations during this period, with over $235 million in ETH contracts flushed, compared to Bitcoin's $186 million. This inversion is likely due to Ethereum experiencing a more pronounced price drawdown in the short term. Among altcoins, Solana (SOL) saw the highest liquidation volume, with $37 million in positions closed, followed by XRP at $16 million and Dogecoin (DOGE) at $12 million, underscoring the broad-based impact of the market's retreat across various digital assets.
Bitcoin Dips Below Critical On-Chain Support
Adding to the bearish sentiment, Bitcoin's recent price decline pushed it below a crucial on-chain price level: the Active Realized Price. This metric, currently positioned at $87,900, represents the average cost basis of active participants on the Bitcoin network. Falling below this level implies that a significant portion of active investors are now holding their Bitcoin at an unrealized loss. At the time of reporting, Bitcoin was trading around $87,200, reflecting a decline of over 3% in the last seven days.
