Bitcoin News Today: Bitcoin Ethereum Solana Selloff Subsides After Major Liquidations

Large-scale liquidations hit Bitcoin (BTC), Ethereum (ETH), and Solana (SOL) in early August, wiping out hundreds of millions of dollars worth of leveraged long positions as prices plummeted to short-term lows. The sharp selloff, primarily driven by forced liquidations in derivative markets, created cascading downward pressure. Traders who had maintained leveraged bullish positions found their positions forcibly closed as the market dropped rapidly, contributing to a highly volatile environment over the past several days [1].

However, on-chain data and exchange flows now suggest that the worst of the selling has subsided. Open interest has declined, and funding rates in leveraged trading have also dropped, signaling that the excess leverage has been largely flushed out of the system. This marks a potential turning point, as the market begins to reset and restructure. With fewer sellers pushing the price lower and a more balanced trading environment emerging, conditions appear more favorable for a potential price rebound [2].

Crypto analysts are beginning to shift their focus toward a possible rally. Historical patterns in the crypto market show that major liquidation events are often followed by sharp recoveries, particularly when the selling pressure is exhausted. With the current market structure showing signs of stabilization, many traders are now watching key resistance levels for potential breakout opportunities in the coming weeks [3].

Ethereum, which had dropped as much as 12.5% after reaching $3,900 in late July, has shown early signs of bottoming out. Solana, too, experienced a 5% decline but appears to be regaining ground amid broader altcoin strength. The broader market has seen renewed interest in options trading, with bullish bets increasing on Ethereum and other altcoins for a potential year-end rally. These developments indicate that while the short-term outlook remains uncertain, some market participants are already positioning for a recovery [4].

Bitcoin, which had pulled back from a high of $123,000 to $113,231, is showing signs of consolidation near the $113K level. The recent selloff has led to questions about whether this was a short-term correction or the beginning of a more prolonged bearish phase. Some analysts caution that new U.S. tariffs and macroeconomic uncertainties could dampen the crypto rally in the coming weeks. However, others argue that the rapid liquidations seen in this correction are typically short-lived and often lead to quick rebounds [5].

As the market absorbs new regulatory and macroeconomic developments, the immediate focus remains on whether the current stabilization will evolve into a sustained bullish trend. While nothing is guaranteed in crypto, the current market conditions appear more favorable for buyers than sellers. Investors, both institutional and retail, continue to watch closely for signs of a stronger recovery in the near term [6].

Sources:

[1] https://coincentral.com/bitcoin-and-ethereum-etfs-suffer-second-worst-day-of-2025-in-odd-end-to-landmark-week-for-crypto/

[3] https://medium.com/@dominalt/crypto-is-crashing-again-heres-exactly-why-ff5b00a546e3

[4] https://www.ainvest.com/news/bitcoin-news-today-altcoins-gain-momentum-bitcoin-consolidates-62-dominance-2508/

[5] https://www.cnbc.com/2025/08/03/expect-crypto-rally-to-cool-in-august-as-new-tariffs-raise-macro-concerns-.html