Key Points
- The total crypto market experienced a drop of more than 10%, with Ethereum leading the losses.
- Over $2.2 billion was liquidated from the leveraged crypto market, with Ethereum’s trading pairs leading in net liquidation.
The total value of the cryptocurrency market fell by over 10% in the last 24 hours, settling at around $3.2 trillion on February 3, 2025.
The price of Ethereum (ETH) led the altcoin industry in significant losses, while the price of Bitcoin (BTC) slipped below $96K to retest the support level around $91K.
Crypto Market Volatility
The sudden increase in crypto market volatility resulted in more than $2.2 billion being liquidated from the leveraged crypto market.
Ethereum’s trading pairs led the liquidations over the last 24 hours, with a total of about $609M, of which $479M involved long traders.
Other notable crypto liquidations included Bitcoins with around $410 million, Ripple Labs’ XRP with $117 million, Dogecoin with around $87 million, and Solana with $85M.
These recent crypto liquidations were the largest recorded since the inception of Bitcoin.
Reasons for the Market Dump
The crypto market has been experiencing the aftermath of overheated leveraged markets in the past few months.
The heavy crypto liquidations of long traders in recent days have resulted in an ongoing long-squeeze.
The crypto market has also been influenced by the wider global stock indexes, which have been signaling potential further selloffs.
Trade wars between the US and other nations have triggered mid-term market uncertainty.
The crypto market has experienced low bullish momentum as whale investors lack confidence in the mid-term recovery outlook.
Future Predictions
The crypto market has been in a macro bull rally, fueled by institutional investors and nation-states seeking to capitalize on digital assets.
Most crypto analysts believe that the macro bullish sentiment will continue in the future.
However, if the Bitcoin price continues to fall below $90K, the crypto market could be trapped in a macro bearish sentiment.
If the Bitcoin price consistently closes above $108K, it will trigger the thrilling phase of the macro bull cycle.
