Bitcoin’s plunge from $112,000 to less than $106,000 on Monday triggered the largest wave of liquidations in recent weeks, wiping out more than $1.27 billion in leveraged futures positions across crypto markets.
According to CoinGlass data, long traders accounted for nearly 90% of all liquidations, with more than $1.14 billion of bullish bets wiped out as prices fell from weekend highs. The shorts accounted for just $128 million of the total.
Liquidation occurs when a trader using borrowed funds is forced to close a position because the margin falls below the required level. On crypto futures exchanges, this process happens automatically. If the price moves sharply against a leveraged trade, the platform will sell the position to the open market to cover the loss.
A large cluster of prolonged liquidations could signal a capitulation and possible short-term bottom, while a reversal in momentum could result in a mass short-term wipeout ahead of a localized top. Traders can also track where liquidation levels are concentrated, helping to identify zones of forced activity that may act as short-term support or resistance.
The single largest liquidation occurred on HTX, with $33.95 million of BTC-USDT longs closed.
Hyperliquid led all platforms in overall activity with $374 million in forced closures, 98% of which were long. This was followed by Bybit with $315 million and Binance with $250 million.
The flash comes amid thin order backlogs across major permanent exchanges following Bitcoin’s recent rejection above $113,000, with a chain of liquidations occurring during periods of low liquidity, magnifying price volatility.
Such events typically mark a short-term “moment of liquidation” in an overheated market, where leverage is reset and spot buying gradually recedes.
Still, with open interest still hovering near $30 billion and funding rates easing only slightly, traders are wary of further volatility ahead of the Federal Reserve’s interest rate decision later this week.
Ethereum and Solana faced similar pressure, with total liquidations totaling more than $300 million, but most altcoins recorded declines as speculative appetite waned.
