Cryptocurrency Sees 2.6 Billion Dollar Liquidation Bomb as 580,000 Retail Investors Wiped Out at Once
Cryptocurrency Sees 2.6 Billion Dollar Liquidation Bomb as 580,000 Retail Investors Wiped Out at Once
Bitcoin (BTC) has come under pressure near the psychological resistance level of $60,000, as the cryptocurrency market was hit by a shock approaching structural collapse, with more than $2.6 billion in liquidity evaporating from the market within 24 hours.
According to reports, approximately $2.65 billion worth of forced liquidations occurred across the global digital asset market over the past 24 hours. On-chain data analytics platform CoinGlass reported that 586,053 investors lost their positions during this event, with long-position liquidations alone exceeding $2.2 billion. This ranks among the largest liquidation events in cryptocurrency history, surpassing the previous record of $2.56 billion set on January 31.
Market analysis firm The Kobeissi Letter assessed that this plunge is not a short-term shock but an extension of a structural downtrend that has continued since October last year. The total cryptocurrency market capitalization has fallen by 50% from its October peak, erasing approximately $2.2 trillion. Bitcoin, in particular, has given back all gains made after the election of U.S. President Donald Trump, falling more than 10% and amplifying market uncertainty.
Liquidity depletion and a severe deterioration in investor sentiment are also weighing heavily on the market. The current depth of the Bitcoin market has shrunk to around 30% of its October peak, a level comparable to the collapse of cryptocurrency exchange FTX in 2022. As liquidity dries up, abnormal daily price swings of up to $10,000 have emerged, fueling a vicious cycle of further liquidations. With Bitcoin retreating toward the $60,000 level, an unprecedented situation has unfolded in which even the average acquisition prices of major holders such as MicroStrategy are being threatened.
Veteran technical analyst Peter Brandt offered a pessimistic outlook, suggesting that prices could fall further to around $42,000 based on Bitcoin’s Power Law model. Comparing current conditions to past bear market cycles, Brandt noted that Bitcoin has entered what he calls a “banana peel” zone of sharp decline. He added that while bulls may not remain below the $42,000 level for long, a painful period of adjustment could persist in the near term.
Nevertheless, signs of market capitulation are emerging, cautiously fueling expectations of a bottom formation. On-chain analytics firm Glassnode reported that Bitcoin’s capitulation index has surged to its second-highest level in the past two years. This suggests that forced selling has reached a peak and that, as excessive leverage is unwound, tangible buying opportunities may arise. Economist Daniel Lacalle 전망ed that this deleveraging process could represent a strong entry point for long-term investors.
In conclusion, the cryptocurrency market is undergoing a harsh cleansing process as speculative demand recedes rapidly. While the likelihood of a short-term recovery remains low, analysts also view this phase as one in which market froth is being removed and spot-driven accumulation may begin. Experts commonly advise investors to brace for heightened volatility and adopt a cautious approach by closely monitoring whether prices stabilize at key support levels.
*Disclaimer: This article is for investment reference only, and no responsibility is taken for any investment losses based on its content. The information should be interpreted solely for informational purposes.*
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