Crypto Liquidations Surge to $900M Amid Bitcoin and Ether Plunge
Crypto markets faced roughly $900 million in liquidations as overleveraged longs unwound amid sharp Bitcoin and Ether corrections. Ether traders accounted for $320 million in liquidations, Bitcoin for $277 million, and Solana, XRP and Dogecoin combined for $90 million, according to Coinglass. Ether slid from $4,700 to $4,400 and Bitcoin dipped to about $110,200, mirroring weakness in the S&P 500. Volatility spiked—Bitcoin’s daily vol jumped from 15% to 38%, Ether’s from 41% to 70%—and options skew turned negative as traders favored puts. Implied odds of Bitcoin revisiting $100,000 by September-end rose to 35%, while Ether’s chance of retesting $4,000 climbed to 55%. Record short positions emerged in ETH futures amid hedging flows. With U.S. GDP and unemployment data imminent, traders brace for continued volatility and potential fresh liquidations.
Bearish
The $900 million in forced liquidations underscores the market’s vulnerability to excessive leverage and tends to amplify sell-offs in the short term. Historical precedents—such as the March 2020 and May 2021 liquidations—led to further price declines before markets found support. The surge in volatility and negative skew in options indicates a prevailing defensive stance among traders. In the near term, key support levels around $100,000 for Bitcoin and $4,000 for Ether may face renewed tests. Over the longer horizon, the flush of leverage could reduce immediate systemic risk, potentially paving the way for stabilization or a rebound if macro fundamentals prove supportive. However, traders should remain cautious of choppy conditions and monitor funding rates, open interest and upcoming U.S. economic data for fresh triggers.