A sharp pullback across crypto markets on Tuesday triggered nearly $735 million in liquidations with bulls bearing the brunt.
Ether (ETH) and XRP tracked futures bets booked larger losses than bitcoin in an unusual move, indicative of the higher interest toward altcoin traders in the past week.
CoinGlass data shows ETH traders lost $152.78 million, the largest for any asset, followed by $88.58 million in liquidations for XRP. Bitcoin came in third at $65.29 million, despite its larger market cap and deeper liquidity.
While price action across the majors was mostly down by only a few percentage points, the high leverage used by retail traders in altcoins likely amplified their losses. In total, $625.5 million of the liquidations were on long positions, suggesting the selloff caught many bulls off guard after weeks of upward momentum.
Other heavily hit tokens included Solana’s SOL at $41 million, dogecoin (DOGE) at $40 million, and smaller DeFi tokens like SPK and PUMP seeing over $10 million in positions wiped.
The absence of a clear catalyst and profit-taking near key resistance levels may have exacerbated the selloff. Ether had recently flirted with the $4,000 mark while Bitcoin traded above $118,000 — levels that had already prompted profit booking from larger wallets.
As of writing, ETH is down roughly 3.6% on the day to trade near $3,540, while XRP fell 6% to $3.25, extending its weekly loss to over 12%. Bitcoin fared better, slipping just under 2% to hover around $116,800.
Crypto liquidations occur when leveraged positions are forcibly closed due to a price move beyond a trader’s margin threshold. This typically results in major losses and can trigger cascade effects during volatile moves.
Traders use liquidation data to gauge market sentiment and positioning. Large long liquidations often signal panic bottoms, while short liquidations may precede a squeeze.
Spikes in liquidations also help identify overcrowded trades and potential reversals. When paired with open interest and funding rate data, liquidation metrics can offer strategic entry or exit points, especially in overleveraged markets prone to sudden flushes or rallies.