Key Highlights
- Around $1 billion in leveraged crypto positions were liquidated in 24 hours, with longs accounting for over 91% of the total.
- Ethereum took the largest hit as it fell more than 5% to around $2,350, while Bitcoin declined about 3% to near $81,000.
- The sell-off was driven by hotter-than-expected U.S. inflation data that increased uncertainty over the Federal Reserve’s next rate decision.
Amid growing geopolitical tensions, the crypto market continues to witness a bloodbath. On Thursday, a major liquidation wiped out approximately $1 billion in just 24 hours, sparking fear within the entire crypto community.
According to CoinGlass, in the last 24 hours, more than 182,000 traders were liquidated, wiping out around $972 million worth of investment from the crypto market. The liquidation has affected 91.7% of long positions and 8.3% of short positions. The biggest liquidation was witnessed in Ether (ETH) and Bitcoin (BTC).
The crypto market had recently gained momentum, and it was following an upward trajectory before today’s liquidation. However, the ambiguity around a Federal interest rate cut has triggered downward momentum in the crypto market.
Cryptocurrency markets faced a sharp sell-off on Thursday, as around $1 billion in leveraged positions were liquidated. Traders betting on higher prices took the brunt of the losses when uncertainty over the Federal Reserve’s next interest rate decision intensified. Bitcoin, Ethereum, and XRP all declined.
The wave of liquidations hit and token prices dropped across the board. According to CoinGlass, total liquidations reached about $942.1 million over 24 hours. Long positions accounted for the vast majority, totaling $863.3 million, which is around 91.6% of the total. It means that most of the traders who were forced out had been positioned for prices to rise.
Ethereum traders suffered the heaviest losses among major coins. Ether liquidations totaled around $283 million, with more than $261 million coming from long positions. Bitcoin followed with approximately $200 million in liquidations, of which about $176 million were longs. The overall market felt the pressure too, with the total currency market capitalization falling nearly 5% to about $2.76 trillion.
Main Factor Behind $1 Billion Liquidation on October 15
The main driver was the latest uncertainty around the Federal Reserve’s policy path. Wednesday’s U.S. Consumer Price Index report mentioned that September inflation rose 3.7% year-over-year, up from 3.4% in August. Core CPI, which excludes food and energy, also climbed to 2.6% from 2.4%. The hotter-than-expected numbers raised the odds of further rate hikes rather than cuts.
Markets have been watching for signs that the Fed might pause or ease. Instead, the data revived concerns that rates could stay higher for longer. CME FedWatch data showed the probability of an October rate hike fluctuating, at one point rising before settling around 25%. The next Federal Open Market Committee meeting is scheduled for October 27 and 28. Traders and investors reacted by reducing risk exposure, which amplified selling in leveraged crypto markets.
Asian equity markets added to the risk-off mood. South Korea’s KOSPI index dropped sharply, and Japan’s Nikkei also declined, with semiconductor stocks leading the losses. These moves spilled over into cryptocurrency trading, where high leverage made positions vulnerable to even moderate price drops.
Much of the liquidation activity occurred in a concentrated period. CoinGlass recorded around $486 million in liquidations in a single recent hour, which is more than half the 24-hour total. Binance handled the largest share of the forced closures, about 53.7%. The single biggest order was a $12.03 million Bitcoin long position closed on Binance at around $80,209.
Bitcoin, Ethereum, and XRP Drops Following Major Liquidations
Bitcoin is currently trading at around $81,000, down approximately 2.5% to 3% over 24 hours. It had clearly tested levels below $81,000 after reaching a recent high near $83,700. The decline forced many leveraged long positions out of the market as prices broke key support areas. This comes after Bitcoin futures open interest declined by $1.4 billion earlier this month, on October 4.
Ethereum also suffered a major drop. The second-biggest cryptocurrency dropped by more than 5% to around $2,350- $2,374. Its higher volatility and relatively elevated leverage compared with Bitcoin meant Ether positions absorbed a larger share of the liquidations relative to its market size.
XRP declined about 5%, trading near $1.30. The token moved lower alongside the broader market as risk appetite faded. Other popular cryptocurrencies such as Solana and Dogecoin also posted losses in the 5% to 6% range.
