In a significant downturn, Bitcoin fell below $106,000 early on Friday within European trading hours, triggering severe losses for leveraged traders. Over the past 24 hours, nearly $1.2 billion in cryptocurrency positions were liquidated, primarily affecting long positions as traders had bet heavily on a market rebound earlier in the week. Data from CoinGlass reveals that around 79% of these liquidations involved long trades, impacting over 307,000 accounts.
The largest individual loss was a substantial $20.4 million Ethereum (ETH) long position on Hyperliquid, a decentralized derivatives exchange that has increasingly gained traction among crypto traders. In total, Bitcoin accounted for approximately $344 million in losses, followed by Ether at $201 million, and Solana, which saw losses of about $97 million. Additionally, other tokens like XRP and Dogecoin experienced further liquidations in the tens of millions.
In terms of trading activity, Hyperliquid led the way with $391 million traded, followed by Bybit at $300 million, Binance at $259 million, and OKX at $99 million. This distribution highlights the growing intersection between on-chain trading venues and traditional exchanges during periods of dramatic market shifts.
Liquidations occur when traders using leverage cannot satisfy margin requirements, forcing the closure of their positions to curb further losses. Such scenarios can lead to cascading sell-offs as numerous stop orders trigger simultaneously, creating what traders refer to as a “liquidation loop.” These loops can be monitored through liquidation heatmaps and open interest data, which indicate areas of significant leverage in the market. As prices approach these critical zones, traders are often on high alert for potential events that could lead to significant price movements.
The decline in Bitcoin’s price began late Thursday when it fell below the $107,000 threshold, initiating a series of forced closures that reverberated across derivatives markets. This decline takes place amid a challenging macroeconomic environment, exacerbated by renewed tensions between the U.S. and China, which have dampened risk sentiment. Compounding concerns are signs of a stronger yen and falling gold prices, contributing to the overall uncertainty in financial markets. Bitcoin has since relinquished much of its gains from earlier in the week, with Ether trading just below $3,900, marking a decline of about 4% for the day.
