Three Altcoins with Significant Liquidation Risks in Mid-January

As the altcoin market enters the second week of January, signals remain unclear. While some tokens have reached new all-time highs, others show signs of recovery amidst uncertainty. Most altcoins are still struggling to bounce back from last October's notable sell-off.

Key Takeaways

Volatility in the Altcoin Market: The altcoin market shows mixed signals, with some tokens experiencing highs while others struggle.
Solana (SOL): Despite high expectations for SOL’s growth, recent data suggests the demand is overstated. If SOL drops to around $132, nearly $1 billion in long position liquidations could occur.
Monero (XMR): XMR has reached new highs but is at risk due to resistance levels and increased open interest. A pullback to $454 could result in over $20 million in liquidations.
Render (RENDER): RENDER has gained over 90% since the start of the year, driven by interest in AI coins. A rise to $2.93 could lead to up to $5.8 million in short position liquidations.

In this context, three altcoins stand at high risk of significant liquidations due to possible misconceptions among traders regarding the actual market demand.

Solana (SOL)

The meme-coin wave of early 2026 isn’t particularly strong, but it does indicate that traders are becoming more willing to take risks. The Solana ecosystem has reached several new records, with the DEX volume on Pump.fun hitting an all-time high. Additionally, the daily deployment of meme tokens has seen a surge.

Consequently, many traders remain optimistic about SOL’s potential for growth throughout January, as indicated by liquidation data, which reveals that potential liquidations on long positions far surpass those on short positions.

However, traders may be overestimating demand. Data from Santiment shows that new wallet creations peaked at 30.2 million per week in November 2024, and have since plummeted to 7.3 million.

SOL’s rally closely correlates with the growth of new wallets. The significant decline in new wallet creation undermines the foundation for this early-year rebound. According to Santiment, "Solana has jumped as high as $144, aiming to surpass its $145 resistance. This will largely depend on whether SOL network growth can start increasing again."

A recent report by BeInCrypto also highlighted that while SOL has seen a recovery with institutional investments flowing in, retail investors, a crucial factor in SOL’s previous explosive growth, are largely absent. If long traders continue to pursue positions without firm stop-loss strategies, they risk nearly $1 billion in liquidations if SOL retreats to the $132 level this week.

Monero (XMR)

The conversation around Monero (XMR) has turned notably positive within the crypto community, with XMR hitting a new all-time high. In contrast, its competitor Zcash (ZEC) has seen a sharp decline as confidence wanes.

The latest seven-day liquidation heatmap indicates that potential liquidations on long positions significantly outnumber those on short positions. XMR long traders should proceed with caution for two primary reasons.

Firstly, XMR has reached a new peak while testing a robust resistance trendline that has been in place since 2018, which could prompt selling pressure from holders who have seen considerable profits.

Secondly, Coinglass data indicates that XMR's open interest has increased by nearly $180 million, marking its highest level ever. As traders increase their capital and leverage right at a significant resistance point, the risk escalates. Should XMR experience a pullback to $454 this week, long traders could face more than $20 million in liquidations.

Render (RENDER)

Since the beginning of the year, Render (RENDER) has surged more than 90%. Data from Artemis highlights significant gains not only for RENDER but also for other AI-related coins, making the AI sector the top performer in the crypto space thus far this year.

Early 2026 appears to show a strong preference among investors for AI coins. This trend could enable RENDER and other AI tokens to continue rising following any short-term corrections.

Altcoin Sherpa remarked, "These AI coins are performing exceptionally well, and they haven’t received much attention lately. FET and RENDER stand out. Buying in and holding seems reasonable, as the upward movement is not yet finished."

The seven-day liquidation map for RENDER reflects a fairly balanced outlook between long and short positions.

If AI coins continue to attract investment this week, short traders in RENDER could face up to $5.8 million in liquidations if RENDER climbs to $2.93.