The cryptocurrency market is facing another downturn as a massive wave of liquidations wiped out over $2 billion in leveraged positions in just one day. Bitcoin, Ethereum, Solana, and other leading assets have seen sharp declines, leaving traders to prepare for potential further turbulence, especially with billions in options nearing expiration.
Data from Coinglass reveals that more than $2 billion in long and short positions were liquidated in the past 24 hours, making it one of the most significant unwinding events since the historic crash in October. Bitcoin dropped to as low as $82,000, while Ethereum fell below $2,700. Long position holders suffered the most, with over $1.8 million in longs eliminated across major exchanges. The largest single liquidation occurred on Hyperliquid, where a BTC-USD position worth $36.78 million was closed. Bitcoin long liquidations alone reached about $966 million, and Ethereum long positions lost approximately $407 million. Although specific tokens or exchanges weren’t identified, the event has heightened bearish sentiment across the market.
Adding to the pressure, a $4.2 billion crypto options expiry is approaching, with over 39,000 BTC options and 185,000 ETH options set to expire. Traders have heavily favored put options, indicating expectations of further price declines. Bitcoin’s max pain point is near $98,000, significantly above its current price, while Ethereum’s is around $3,200. Whale activity has also intensified the sell-off; a major Bitcoin holder from 2011 sold over 11,000 BTC, valued at $1.3 billion, increasing downward momentum. However, other large investors bought over $65 million in spot Bitcoin near $85,000, suggesting strategic purchases during the dip.
The market’s fragility stems from October’s $19.5 billion liquidation event, which severely impacted liquidity. Market makers, still recovering, are proceeding with caution, creating an environment where even small price movements can lead to cascading liquidations. Despite the turmoil, platforms like Solana and Fireblocks demonstrated resilience by maintaining high transaction speeds and network reliability under stress.
As macroeconomic uncertainty, ETF outflows, and whale actions continue to influence sentiment, the crypto market remains on edge. Traders are closely monitoring whether this correction will deepen or pave the way for the next recovery.
Frequently Asked Questions
Of course Here is a list of helpful FAQs about the recent cryptocurrency market volatility designed for both beginners and more experienced users
BeginnerLevel Questions
1 What exactly happened to the 2 billion
It didnt physically vanish from bank accounts The total market value of all cryptocurrencies dropped by over 2 billion because the prices of major coins like Bitcoin and Ethereum fell significantly When prices go down the total calculated value of everyones holdings decreases
2 Why do cryptocurrency prices crash so suddenly
Prices can crash due to a mix of factors like negative news large investors selling off their holdings fears about new regulations or problems with a major crypto company These events can create a panic sell where many people try to sell at once driving prices down rapidly
3 Is my money in a regular bank account safe if crypto crashes
Yes absolutely Cryptocurrencies are separate from the traditional banking system The money in your checking or savings account is protected by government insurance and is not directly affected by crypto market swings
4 What does volatility mean
Volatility simply means that prices can change very quickly and dramatically in a short period Crypto is known for being highly volatile which means you could see large gains or large losses in a single day
5 Should I buy crypto when the price is low
This is a personal decision and carries risk While a dip can be a buying opportunity prices can always go lower Its crucial to only invest money you are prepared to lose and to do your own research first
Advanced Practical Questions
6 What is liquidation in crypto trading
If you trade with borrowed money a liquidation happens when your trade moves against you and your collateral is automatically sold by the exchange to repay the loan This can happen very quickly during sharp price drops amplifying losses
7 Could this crash have been caused by a cascading liquidation
Yes thats a strong possibility As prices start to fall it can trigger a wave of automatic liquidations These forced sales push the price down even further which then triggers more liquidations creating a destructive cycle