The global cryptocurrency market came under sudden pressure on Monday after Bitcoin recorded a steep intraday decline.
The downturn triggered a wave of liquidations that erased hundreds of millions in leveraged positions across major exchanges.
Bitcoin Reverses Weekend Stability With Rapid Decline
Bitcoin had maintained relative stability over the weekend, hovering near $91,500 as it tested a key resistance zone near $93,000 mark. The price action marked a consolidation phase approaching the end of the month.
However, that stability unraveled quickly. On Monday, Bitcoin fell almost 5% in four hours, reaching $85,610 on Binance. Notably, the downturn came shortly after the asset posted its first positive weekly close in four weeks, finishing at $90,360.
This sharp reversal set the tone for broader market stress that soon followed.
Analysts Attribute Decline to Leverage Unwinding
As the sell-off intensified, analysts at The Kobeissi Letter attributed the move to a sudden surge in selling volume. They noted that this burst of activity triggered a chain reaction across leveraged positions, thereby amplifying the downward momentum.
The firm emphasized that the slump lacked an obvious news catalyst, reinforcing the view that current market weakness remains largely structural. Despite the volatility, they argued that the decline does not indicate a breakdown in the fundamentals of the cryptocurrency market.
Liquidations Surge as Over 218,000 Traders Are Wiped Out
Unsurprisingly, the rapid market shift had immediate consequences for traders using leverage. Data from Coinglass showed that over 218,000 traders were liquidated within 24 hours, with total liquidations reaching $640.34 million.
In particular, this wave of forced closures intensified in the last 12 hours, during which losses totaled $579.11 million. The majority of these liquidations targeted long positions, illustrating how abruptly bullish sentiment was reversed.
Long Traders Face the Heaviest Losses
Coinglass data revealed that within the 12-hour window, long positions accounted for $546.80 million of liquidations, compared to $32.31 million for short positions.
Over the full 24 hours, long liquidations totaled $565.56 million, while shorts contributed $74.78 million. This imbalance underscores how many traders had been positioned for further upside when the downturn struck.
Among individual liquidation events, the largest occurred on Binance, involving an ETH/USDC leveraged position worth $14.48 million. This, in turn, underscored the scale of exposure across major trading pairs during the sudden market correction.
In terms of asset-specific impact, Bitcoin saw the most significant liquidation volume, with $204.44 million erased. Following closely, Ethereum accounted for $159.58 million, while Zcash (ZEC) ranked third at $21.36 million, thereby reflecting how the broader market mirrored Bitcoin’s sharp intraday reversal.
DisClamier: This content is informational and should not be considered financial advice. The views expressed in this article may include the author's personal opinions and do not reflect The Crypto Basic opinion. Readers are encouraged to do thorough research before making any investment decisions. The Crypto Basic is not responsible for any financial losses.
