Altcoin traders face significant losses as crypto market sees $630M in liquidations.

Ether and XRP traders experienced larger losses than Bitcoin after a sharp pullback in crypto markets, with $152.78 million and $88.58 million in liquidations respectively. Bitcoin traders lost $65.29 million. The high leverage used by retail traders in altcoins likely amplified their losses, and the absence of a clear catalyst and profit-taking near key resistance levels may have exacerbated the selloff.

Crypto markets experienced a significant downturn on Tuesday, resulting in nearly $735 million in liquidations, with long positions bearing the brunt of the selloff. Notably, Ether (ETH) and XRP futures traders booked larger losses than Bitcoin, indicating increased interest in altcoin trading.

According to data from CoinGlass, Ether traders lost $152.78 million, the largest amount for any asset, followed by $88.58 million in liquidations for XRP. Bitcoin, despite its larger market cap and deeper liquidity, came in third with $65.29 million in liquidations. The high leverage used by retail traders in altcoins likely amplified their losses. In total, $625.5 million of the liquidations were on long positions, suggesting the selloff caught many bulls off guard after weeks of upward momentum.

Other heavily hit tokens included Solana’s SOL at $41 million, Dogecoin (DOGE) at $40 million, and smaller DeFi tokens like SPK and PUMP seeing over $10 million in positions wiped. The absence of a clear catalyst and profit-taking near key resistance levels may have exacerbated the selloff. Ether had recently flirted with the $4,000 mark while Bitcoin traded above $118,000 — levels that had already prompted profit booking from larger wallets.

As of writing, ETH is down roughly 3.6% on the day to trade near $3,540, while XRP fell 6% to $3.25, extending its weekly loss to over 12%. Bitcoin fared better, slipping just under 2% to hover around $116,800.

Crypto liquidations occur when leveraged positions are forcibly closed due to a price move beyond a trader’s margin threshold, typically resulting in major losses and triggering cascade effects during volatile moves. Traders use liquidation data to gauge market sentiment and positioning, with large long liquidations often signaling panic bottoms.

The sharp decline in XRP's market capitalization, which plummeted by approximately $18.37 billion within 24 hours, was driven by a stark imbalance in liquidations. The token’s price fell 9.6% to $3.21, despite a 6.1% gain over the preceding seven days. The sell-off was triggered by an abrupt regulatory reversal by the U.S. Securities and Exchange Commission (SEC), which halted the conversion of Bitwise’s 10 Crypto Index Fund into an ETF. This regulatory uncertainty highlights the vulnerability of leveraged positions in crypto markets and the outsized influence of regulatory decisions on asset prices.

Coinbase has introduced regulated perpetual futures trading for American users through its CFTC-registered entity, Coinbase Financial Markets. The platform now offers nano Bitcoin and Ether perpetual futures with up to 10x leverage and the ability to hold positions for five years. This development positions Coinbase as a domestic competitor in a space previously dominated by offshore exchanges.

As the U.S. House prepares to vote on crypto bills, analysts point out three altcoins likely to benefit: Hedera (HBAR), Ondo Finance (ONDO), and Sei (SEI). Hedera, with its hashgraph technology and institutional appeal, is set to be one of the first platforms compliant enough to onboard real institutional capital. Ondo Finance, with its tokenized real-world assets, and Sei, with its high-speed DeFi capabilities, are also positioned to benefit from regulatory clarity.

References:
[1] https://www.coindesk.com/markets/2025/07/24/ether-xrp-trades-book-bigger-losses-than-bitcoin-as-bulls-see-usd680m-liquidations
[2] https://www.ainvest.com/news/xrp-news-today-xrp-loses-18-37-billion-sec-halts-bitwise-etf-approval-triggering-9-6-price-drop-2507/
[3] https://cryptofrontnews.com/coinbase-launches-regulated-perpetual-futures/
[4] https://coinedition.com/top-3-altcoins-to-watch-before-us-crypto-bills-pass/