A large-scale liquidation event in the cryptocurrency market is heightening caution among leveraged investors. Analysts say that as long (buy) positions were concentrated in liquidations during the price decline, a so-called 'liquidation cascade' occurred, triggering additional selling.

■ $369.67 million liquidated... 82% concentrated in long positions

gShador, an active member of the CoinMarketCap community, analyzed recent market movements and reported that positions worth more than $369 million were liquidated across the entire cryptocurrency derivatives market. According to related market tallies, the liquidation volume amounted to approximately $369.67 million.

A breakdown shows that about $301.84 million was liquidated from long positions that had bet on price gains, while short (sell) position liquidations totaled about $67.83 million. In other words, roughly 82% of total liquidations were concentrated in long positions. This suggests that leveraged buy positions took a relatively heavy hit as the market declined.

■ Liquidations by coin... Bitcoin at $111.83 million

A significant amount of liquidation also occurred in Bitcoin (BTC), the so-called 'market bellwether.' According to related tallies, Bitcoin liquidations reached approximately $111.83 million. At the time, Bitcoin fell to the $77,200–$77,600 range, amplifying volatility.

Ethereum (ETH) also saw liquidations of about $95.39 million, while Solana (SOL) recorded roughly $27.09 million in forced liquidations.

■ Why a 'liquidation cascade' occurs

What the market is watching in this movement is not the price decline itself, but the structure in which leveraged positions amplify price volatility. When Bitcoin's price falls rapidly, stop-loss orders and forced liquidations due to insufficient margin can occur simultaneously. In this process, as exchanges place sell orders to close out positions, prices can be pushed down further, potentially leading to a vicious cycle that triggers new liquidations.

■ Rising oil prices and Treasury yields also weigh

The macroeconomic environment also weighed on the cryptocurrency market. At the time, West Texas Intermediate (WTI) crude exceeded $90–92 per barrel, and the U.S. 10-year Treasury yield climbed to around 4.78–4.79%. When oil prices and Treasury yields rise simultaneously to high levels, risk-asset investment sentiment can shrink. In particular, if expectations strengthen that high interest rates will persist for an extended period, volatility in the highly leveraged cryptocurrency market could expand.

■ The key variable ahead: 'open interest'... remaining leverage

In the market, the extent to which this liquidation removed excessive accumulated leverage is cited as one of the key variables that will determine the next wave of volatility. gShador also analyzed that if open interest remains at high levels even after the large-scale liquidation, it is difficult to rule out the possibility of another sharp price move.

Ultimately, rather than simply focusing on the size of the liquidations, what needs to be examined is how much leverage remains in the derivatives market after the liquidations. A rapid decline in open interest could signal that some of the market's overheating has been resolved, but if it stays at high levels, the risk of cascading liquidations could grow again when prices move sharply.

[※ This article was written for the purpose of providing information about the cryptocurrency market and does not recommend buying or selling any specific virtual asset or guarantee investment returns. The price outlook, support and resistance levels, and target prices mentioned in the article are scenarios based on technical analysis by market participants and may unfold differently from actual price movements. Cryptocurrencies are high-risk assets with extreme price volatility, and you may lose part or all of your investment principal. Investment decisions and their consequences are the responsibility of the investor, so please fully review market conditions and relevant information before investing. This article was written with AI assistance.]