Crypto Markets Experience $600 Million Liquidations as Bitcoin Dips Below $104,000
Cryptocurrency Markets in Turmoil
In a turbulent turn of events, the cryptocurrency market has witnessed over $600 million in liquidations as Bitcoin (BTC) recently dropped below the $104,000 mark. This substantial sell-off marks the highest losses in the market since February, prompting traders to reassess their positions amid growing apprehension.
According to Coinglass data, total liquidations reached approximately $688 million within a 24-hour period, with a staggering 89% of these affecting long positions. This significant liquidation wave reflects an overwhelmingly bullish sentiment leading into this downturn. The largest single liquidation order recorded during this freeze was for $12.25 million in a BTC/USDT trade on the OKX platform.
Breakdown of Liquidations
Bitcoin futures bore the brunt of the losses, with over $153 million in liquidated positions. Ethereum (ETH) followed closely with around $122 million in liquidations. Other cryptocurrencies were also affected, including Solana (SOL) with approximately $33 million, XRP futures at around $30 million, and Dogecoin (DOGE) seeing more than $22 million in liquidations.
Analyst Alex Kuptsikevich, chief market analyst at FxPro, commented on the recent market dynamics, attributing the downturn in part to renewed fears around tariffs affecting global economies. “Markets went red on Friday on renewed tariff-related apprehensions,” Kuptsikevich noted.
Trade Tariff Tensions Impacting Markets
The recent drop in Ethereum and Bitcoin values has coincided with heightened trade tensions between the United States and China. U.S. President Donald Trump announced an increase in tariffs on steel and aluminum imports from China to protect domestic industries. Trump accused China of violating a bilateral trade deal and expressed intentions to discuss these matters with President Xi Jinping.
This development has rattled not only global trade markets but also significantly impacted cryptocurrency markets. As the tensions escalate, many investors are expressing concerns over how such geopolitical factors may further influence market stability.
Broader Market Reaction
The overall cryptocurrency market has faced illuminated declines with Ether depreciating by nearly 4%, while both XRP and Solana observed falls of about 4-5%. Dogecoin suffered the steepest drop, plunging over 8% in value.
Data from Deribit indicates a notable increase in trading activity, with open interest in Bitcoin futures surging by 51% since April and options climbing 126%. Despite this increased interest from investors looking to leverage their positions, there has been a noticeable shift among larger investors—often referred to as "whales." These investors, holding more than 10,000 BTC, have transitioned from accumulation strategies to net selling, reflecting a trend of profit-taking and sending coins back onto exchanges.
Market Outlook
The sudden wave of liquidations might signal a turning point in market sentiment, an indication that a price reversal could be in the cards. However, with ongoing geopolitical tensions and a jittery derivatives market, traders remain cautious, bracing for potential volatility in the days ahead.
As the cryptocurrency landscape continues to evolve, both seasoned investors and newcomers alike are advised to stay vigilant and informed about market trends. Analysts suggest preparing for continued fluctuations as the situation unfolds.
As of May 31, 2025, Bitcoin is priced at approximately $104,332.81, with minor fluctuations influencing trading strategies across the market.
Stay Informed
For those interested in the latest developments in the cryptocurrency space, subscribing to newsletters like CoinDesk’s Crypto Daybook is highly recommended. Keeping abreast of market movements, regulatory changes, and economic factors can greatly assist in navigating this often unpredictable environment.
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