$561 Million in Crypto Positions Liquidated as Bitcoin Falls Below $85,000

Summary:
Bitcoin experienced a significant drop on Thursday, breaking beneath a crucial technical support level, leading to a severe selloff in the cryptocurrency market. This downturn impacted major altcoins and triggered massive liquidations in derivatives markets.

Key Takeaways

Bitcoin's price fell below $85,000, hitting a low of $84,500.
The crypto market faced widespread selling, affecting Ethereum, Solana, and other major cryptocurrencies.
Over $561 million was liquidated in crypto derivatives, with long positions being most affected.
Bitcoin and Ethereum were the most impacted assets, with liquidation totals of $195.82 million and $148.16 million, respectively.
Analysts highlight the importance of the $85,000 support level and warn of potential further declines if broken.

Bitcoin

Bitcoin's Sharp Decline

On Thursday afternoon, Bitcoin saw a sharp decline, falling below a crucial support level and triggering a wider selloff in the cryptocurrency market. This downturn started after Bitcoin was unable to maintain the momentum from an earlier rally. Prices fell beneath the closely monitored $85,000 threshold, reaching a low of $84,500—its weakest point in almost three weeks.

This drop effectively erased a morning increase that brought Bitcoin close to $89,500, according to CoinGecko. Although there was a slight recovery later, Bitcoin still ended the day down by 1.6%, indicating ongoing selling pressure.

Major Cryptocurrencies Also Suffer

As Bitcoin retreated, the selling pressure quickly extended to other leading cryptocurrencies. Ethereum (ETH) also declined, dropping below the $2,800 mark for a daily decrease of 1.1%. The losses for other cryptocurrencies were even steeper, with Solana plunging 4% to fall below $120, reaching its lowest point since April. The broader cryptocurrency market suffered significantly, with many altcoins, including Cardano, Dogecoin, and SUI, showing declines exceeding 5%, which outpaced Bitcoin's losses.

Volatile Market Triggers Liquidations

The rapid price fluctuations sparked a wave of liquidations in the derivatives markets. According to CoinGlass, total liquidations amounted to $561.91 million in the past 24 hours. During this time, 153,854 traders were forced out of their positions. Long traders faced the most significant losses, with $375.23 million in bullish bets erased, while short positions incurred lesser losses of $186.69 million.

Crypto Market Liquidation

Leading Liquidations: Bitcoin and Ethereum

As expected, Bitcoin represented the largest share of total liquidations, with CoinGlass reporting $195.82 million in leveraged Bitcoin positions closed during the selloff. Ethereum followed, with a liquidation total of $148.16 million. Other notable liquidations included Hyperliquid (HYPE) token at $30.05 million and XRP at $12.19 million. The most substantial forced closure occurred on Hyperliquid, where a $6.19 million BTC-USD position was eliminated amid the collapse.

Analysts Warn About Support Level Risks

Attention has now shifted to the technical implications of the recent breakdown. The $85,000 level had served as a tested support zone in recent weeks, consistently drawing in buyers. Analysts from AmberData have labeled this level as 'critical,' warning that a significant break below it could expose Bitcoin to a deeper correction, potentially targeting $80,000, as mentioned in an update on X.

Differing Views on the Cause of Selloff

As market prices fell, debates emerged over the reasons behind the sudden downturn. In a post on X, DeFiTracer, an on-chain analytics account, claimed that major platforms and market makers sold substantial amounts of Bitcoin rapidly, estimating around $3 billion in BTC sales and describing the situation as ‘pure manipulation.’ However, many market participants countered this viewpoint, asserting the selloff was more representative of typical liquidity movements and user-driven transactions instead of coordinated actions.

With the current volatility, traders are keenly observing if Bitcoin can recover its lost value. Analysts suggest that price movements around previous support levels may dictate short-term trends. Until a clearer market direction is established, participants are preparing for ongoing volatility in the cryptocurrency sector.

Disclaimer: This content is for informational purposes only and should not be taken as financial advice. The opinions presented in this article may reflect the author’s personal views and do not represent The Crypto Basic’s stance. Readers are encouraged to conduct thorough research before making any investment decisions. The Crypto Basic is not liable for any financial losses.