Crypto Market Sees $1.25 Billion Liquidations in 24 Hours

The cryptocurrency market experienced a tumultuous period, with liquidations exceeding $1.25 billion in a single 24-hour span. Bitcoin futures were particularly hard hit, with losses amounting to approximately $640 million, while Ethereum futures incurred a $260 million deficit. This financial upheaval affected over 268,000 market participants, as Bitcoin reached an unexpected high of $118,000.

The wave of liquidations was predominantly driven by short positions. Bybit, a major exchange, reported the highest liquidations at $513.86 million, with 93% of these losses coming from short positions. HTX and Binance followed with $204 million and $228 million in liquidations, respectively. A single short position on the BTC/USDT pair worth $88.5 million on the HTX exchange marked the largest individual loss.

Nearly all liquidations resulted from short position strategies that anticipated a market downturn. Investors failed to predict the market’s upward shift, triggering stop-loss orders rapidly. This sequence of events further accelerated price increases, dispelling many short-term leveraged positions and fueling a bullish momentum.

Exchange-Traded Funds (ETFs) played a significant role in sustaining Bitcoin’s price appreciation, with over $15 billion invested in U.S. spot Bitcoin ETFs. BlackRock’s IBIT fund, holding in excess of 700,000 BTC, leads in the institutional scope. Experts believe that ongoing ETF capital inflow will potentially uphold the cryptocurrency rally as summer progresses.

On the broader economic front, initiatives like President Donald Trump’s advocacy for low-interest rates are bolstering risk propensity. Market participants are gravitating towards high-strike futures options, preparing for a possible Federal Reserve monetary easing.

The Bitcoin surge has concurrently stimulated the altcoin market, with Ethereum taking a lead. Its futures trading volume surpassed that of Bitcoin, driving its price to $3,000. Other altcoins such as XRP, Dogecoin, and Solana have also experienced substantial price jumps, indicating a shift in investor focus.

In the first half of 2025, the crypto market experienced significant turmoil marked by a substantial wave of liquidations that primarily affected long positions. This period saw an intense round of liquidations, which dominated market activity and shook investor confidence. The liquidations were part of a broader market correction that affected various cryptocurrencies, including Bitcoin and Ethereum, as well as mid-cap altcoins like Cardano (ADA), Chainlink (LINK), and Uniswap (UNI). These altcoins, however, showed selective momentum with notable gains of 3–6%.

The market volatility was further exacerbated by the actions of major investors, or "whales," who increased their holdings of certain tokens while reducing their exposure on exchanges. For instance, whale holdings of PEPE tokens rose by 1.75% to 303 trillion tokens, while the supply on exchanges decreased by 2.9%. This shift in holdings indicated a strategic move by large investors to capitalize on market fluctuations.

The liquidation wave also had a ripple effect on other sectors, including public companies that had added Bitcoin to their balance sheets. The market correction led to a significant drop in the share prices of companies like K Wave Media Inc., which saw a 15.42% decline to $4.6684. This volatility highlighted the interconnected nature of the crypto market and its impact on traditional financial markets.

Despite the turmoil, there were signs of resilience and adaptation within the crypto market. The surge of institutional capital continued to influence market dynamics, with some investors seeing opportunities in the market correction. The overall sentiment remained mixed, with some investors maintaining high confidence in the long-term potential of cryptocurrencies, while others remained cautious due to the ongoing volatility.

The liquidation wave and subsequent market correction underscored the need for investors to remain vigilant and adaptable in the face of rapid market changes. The crypto market's volatility, while challenging, also presented opportunities for strategic investments and portfolio adjustments. As the market continues to evolve, investors will need to stay informed and responsive to the shifting dynamics and sentiment within the crypto ecosystem.