Bitcoin’s sharp drop from $112,000 to below $106,000 on Monday triggered one of the biggest liquidation waves in weeks, wiping out more than $1.27 billion in leveraged futures positions in crypto markets.
Data from CoinGlass shows that long traders accounted for nearly 90% of total liquidations, with more than $1.14 billion in bullish bets wiped out as prices fell from weekend highs. Shorts accounted for only $128 million of the total.
Liquidations occur when traders using borrowed funds are forced to close their positions because their margin falls below required levels. On cryptocurrency futures exchanges, this process is automatic, since when prices move sharply against a leveraged trade, the platform sells the position on the open market to cover losses.
Large clusters of long sell-offs may signal capitulation and possible short-term lows, while strong short sell-offs may precede local highs as momentum shifts. Traders can also track where liquidation levels are concentrated, which helps identify zones of forced activity that can act as short-term support or resistance.
The biggest sell-off occurred on HTX, where a $33.95 million long BTC-USDT was closed.
Hyperliquid led all platforms in overall activity, recording $374 million in forced closes (98% of them were long positions), followed by Bybit with $315 million and Binance with $250 million.
The surge came after Bitcoin’s latest rejection above $113,000 and amid a thin order book at major perpetual venues, amplifying price swings as cascading liquidations occurred during low-liquidity hours.
These developments often mark short-term “clearing moments” in overheated markets, where leverage is restored and spot buyers gradually return.
Still, with open interest remaining near $30 billion and funding rates declining only slightly, traders appear wary of further volatility ahead of the Federal Reserve’s rate decision later this week.
Ethereum and Solana experienced similar pressure, with combined liquidations exceeding $300 million, while most altcoins fell amid fading speculative appetite.
