Crypto Market Shaken: A $1.5 Billion Liquidation Hits Bitcoin and Ethereum

The start of the week has proved to be challenging for cryptocurrencies, as a liquidation wave sent shockwaves through the market. A total of $1.5 billion worth of positions saw liquidation, marking the largest shake-up since March. The data from Coinglass pointedly shows how profound the impact was, affecting popular cryptocurrencies like bitcoin and ethereum.

What Happened?

Over 407,000 traders found themselves in the middle of this liquidation, which was focused on the crypto derivatives market. Bitcoin, the leading cryptocurrency, witnessed a fall of up to 3%, briefly trading around the $111,000 mark before slightly recovering. In a similar fashion, ethereum took an even more severe hit, dropping as much as 9% at one point.

The Scale of Losses

The effects were not limited to bitcoin and ethereum. Cryptocurrencies such as Worldcoin, FLOKI, and dogecoin faced declines exceeding 9%. With XRP dropping 4% and solana losing 7%, the market experienced one of its most challenging moments in recent memory.

Market Analysts Weigh In

Linh Tran, a market analyst at XS.com, highlighted the importance of this liquidation. According to Tran, the event serves as an essential mechanism to stabilize the market by reducing long positions that were considered overcrowded. He emphasized the long-term benefits, describing this situation as a “correction phase.”

A Necessary Pause?

Tran’s insights were echoed by another analyst, David Morrison from Trade Nation, who remarked on the significant impact on market sentiment. The current pause might be necessary to stabilize prices and provide a solid foundation for future growth, he explained.

What’s Next for Cryptocurrencies?

Despite the recent turbulence, cryptocurrencies have achieved remarkable gains in 2025, thanks to supportive regulatory changes and market-driven optimism. Bitcoin has risen 21%, and ethereum has jumped 26% year-to-date. The next steps for these digital assets will depend heavily on how quickly markets can recover from this liquidation shock.

According to Business Insider, industry experts and investors are now keenly watching the upcoming trading sessions to determine if the crypto market can bounce back or if further declines are on the horizon.