The crypto market took a huge hit in the past 24 hours, with almost $1 billion in liquidations. Traders who had bet on prices going up were hit the hardest.
This comes after a rough start to the week, which had already seen $620.5 million in losses.
Huge Losses for Crypto Traders
According to Coinglass, a total of 334,404 traders lost money due to liquidations, with losses adding up to $947.7 million.
- Long positions (traders betting prices would go up) lost $742.2 million.
- Short positions (traders betting prices would go down) lost $205.5 million.
This shows that the market moved against those expecting a price increase, causing bigger losses for them.
Bitcoin and Ethereum Hit Hard
Bitcoin (BTC) saw the biggest liquidation, with $317.9 million wiped out. Out of this:
- $242.1 million came from long positions.
- $75.8 million came from short positions.
Ethereum (ETH) wasn’t spared either, with $248.2 million in liquidations. Long positions made up $196.4 million of that total.
Big Crypto Players Moving Funds – More Trouble Ahead?
Adding to the panic, large Bitcoin and Ethereum transfers by major players have raised fears of a bigger sell-off.
Earlier this month, Mt. Gox also moved 12,000 BTC, worth $1 billion at the time.
Mt. Gox, the now-defunct exchange, moved 11,834 BTC worth $931.1 million to an unknown address, according to Arkham Intelligence.
A few hours later, it transferred another 332 BTC worth $26.6 million.
Ethereum Whales Also Making Moves
- A whale (a big investor who owns a lot of crypto) who had been inactive for five months suddenly deposited 7,000 ETH ($12.9 million) to Kraken as ETH’s price dropped. This investor still holds 30,070 ETH ($54.4 million).
- Longling Capital transferred 21,000 ETH ($38.8 million) to Binance.
- Another whale sold 25,800 ETH at a $31.7 million loss to avoid even bigger losses.
What Triggered the Crypto Crash?
The latest wave of panic started after former U.S. President Donald Trump made comments about a possible recession.
In an interview with Fox News, he said:
“Look, we’re going to have disruption, but we’re ok with that.”
These words sent shockwaves through the financial markets. Stocks dropped, and cryptocurrencies took a major hit.
According to The Kobeissi Letter, a financial newsletter, this wiped out the gains crypto made after the US Reserve’s announcement last week.
The total crypto market has now lost $1.3 trillion since its peak on December 17, 2024.
“Not only does this mean crypto’s bear market has begun, but it’s also down 35% in three months,” the report said.
Bitcoin Drops to a 4-Month Low
Bitcoin fell to $76,600, its lowest level in four months. It later recovered slightly to $79,939, but it’s still down 3.2% in the past day.
Ethereum also saw a big drop, falling 8.4% in 24 hours. It was trading at $1,895 at press time, its lowest price since late 2023.
Crypto Market Crashes Have Happened Before
This isn’t the first time the crypto market has seen such a big crash:
- In May 2021, Bitcoin lost 50% of its value in just a month after China banned crypto mining and Tesla stopped accepting BTC.
- In November 2022, the collapse of FTX, one of the biggest crypto exchanges, caused $1 trillion in market losses.
- In March 2023, a banking crisis forced investors to pull money out of crypto, leading to another sell-off.
What’s Next for Crypto?
Right now, the crypto market is facing a lot of uncertainty. With big investors moving funds and fears of a recession growing, traders should expect more volatility ahead.
