Crypto market sees $2B in liquidations — bigger than Covid and FTX crashes
The cryptocurrency market suffered a sell-off in the last 24 hours, wiping out $2.29 billion in liquidations — more than the Covid crash and the FTX collapse.
According to CoinGlass data, 733,974 traders were liquidated in the past day, with $1.89 billion coming from long positions, making up 82.73% of total liquidations.
Liquidation in futures trading occurs when a trader’s position is forcibly closed due to insufficient margin to cover losses. Long positions bet on an asset’s price increasing, while short positions profit from price declines. When prices move against a trader’s position, exchanges liquidate holdings to prevent further losses.
The largest single liquidation order took place on HTX, where a BTC-USDT trade worth $38.78 million was wiped out.
Bitcoin dropped 2.24%, trading at $95,000, while Ethereum plunged 14%. Major altcoins, including XRP, Solana, and Binance Coin, also fell between 10-15% amid the broader market downturn.
During the Covid-19 crash on March 13, 2020, the global crypto market saw its worst-ever single-day correction, plunging 39.6%. The total market capitalization dropped from $223.74 billion to $135.14 billion overnight. Bitcoin also recorded its biggest price decline of -35.2%, while Ethereum suffered an even steeper drop of -43.1% in the same period. The crash was triggered by widespread panic selling as investors fled risk assets amid global uncertainty.
Analysts point to growing fears of a global trade war as a key trigger for the liquidation cascade.
According to QCP analysts, the Trump administration implemented 25% tariffs on Canadian and Mexican goods, alongside a 10% levy on Chinese imports. Canada retaliated swiftly, imposing 25% tariffs on $106 billion worth of U.S. goods, with Mexico expected to follow suit.
Treasury yields bear-flattened — 2-year yields rose while 10-year yields fell, signaling inflation fears and long-term economic risks.
Equities fell across global markets, while gold dipped and oil spiked in response to uncertainty. Crypto took the hardest hit, acting as a high-risk asset proxy before US markets opened.
“This decorrelation reinforces the view that today’s risk-off move is driven by cross-asset portfolio rebalancing rather than a single-asset event,” QCP analysts noted. “Expect continued volatility as Trump prepares to negotiate with Canada and Mexico tonight, while claiming tariffs on the EU are ‘definitely happening.’”
Ethereum saw $614.34 million in liquidations, with 77.07% of them being long positions.
Long positions wiped out $473.49 million while short positions liquidated $140.85 million