Crypto Markets Crash as $1.7B in Liquidations Rock Bitcoin and Ethereum

Total crypto market capitalization has dropped to around $2.78 trillion, down nearly 7% on the day, as risk appetite evaporated and leveraged positions were aggressively flushed out across major assets.

Market-Wide Sell-Off Accelerates

The decline has been led by Bitcoin, which fell toward the $82,000 area, marking a multi-week low after failing to hold key support levels. Ethereum followed closely, sliding below $2,800, while large-cap altcoins such as Solana, XRP, and BNB recorded losses ranging from high single digits to double digits over the past seven days. Market sentiment deteriorated rapidly, with the Fear & Greed Index dropping deep into fear territory, reflecting broad risk-off behavior.

Altcoins were hit particularly hard, as the Altcoin Season Index slipped toward the low 30s, signaling a return to Bitcoin dominance during stress conditions. At the same time, the average crypto Relative Strength Index across major assets has moved into oversold territory, highlighting the intensity and speed of the sell-off rather than a slow distribution phase.

Liquidations Sweep the Market

The downturn was amplified by a wave of forced liquidations in derivatives markets. Over the 24 hours, more than $1.69 billion in positions were wiped out, with the overwhelming majority coming from long positions. Bitcoin accounted for roughly $783 million in liquidations, while Ethereum saw more than $416 million liquidated. In total, over 269,000 traders were forced out of positions in a single day, underscoring how much leverage had accumulated during the prior rally.

This liquidation cascade accelerated downside momentum as margin calls and stop-losses triggered automatic selling, pushing prices rapidly through key technical levels. Volatility surged as liquidity thinned, particularly during periods of concentrated selling pressure.

Bitcoin Technical Breakdown

From a technical standpoint, Bitcoin’s daily chart shows a clear breakdown from its previous consolidation structure. Price has moved sharply lower from recent highs, with momentum indicators confirming weakness.

The Relative Strength Index is hovering near the low 30s, approaching oversold conditions, while the Moving Average Convergence Divergence remains deeply negative, signaling sustained bearish momentum. Rising volume on down days reinforces the validity of the move rather than suggesting a temporary shakeout.

Key support now sits in the $80,000 – $78,000 zone. A decisive loss of this area would increase the risk of a deeper corrective phase, while stabilization could open the door for a short-term relief bounce.

What Investors Should Watch Next

In the near term, volatility is likely to remain elevated as leverage continues to reset and sentiment attempts to stabilize. Investors will be watching closely to see whether Bitcoin can defend critical support levels and whether liquidation pressure begins to fade.

While oversold conditions raise the probability of short-term rebounds, any sustainable recovery will depend on price structure, volume confirmation, and broader macro developments.

Until confidence returns, crypto markets are likely to trade defensively. The current sell-off serves as a reminder that leverage-driven rallies can unwind quickly – and when they do, the effects ripple across the entire digital asset market.

The information provided in this article is for educational purposes only and does not constitute financial, investment, or trading advice. Coindoo.com does not endorse or recommend any specific investment strategy or cryptocurrency. Always conduct your own research and consult with a licensed financial advisor before making any investment decisions.

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