Key Points
- The crypto derivatives market lost $279 million due to liquidations over the weekend.
- These liquidations affected about 80,590 traders, mainly on exchanges like OKX, Binance, and Bybit.
The crypto derivatives market experienced significant upheaval over the past weekend, leading to a loss of $279 million from leveraged positions.
Data from blockchain analytics firm CoinGlass reveals that this substantial loss impacted around 80,590 traders, predominantly on centralized exchanges such as OKX, Binance, and Bybit.
Details of the Liquidations
Traders on OKX lost approximately $78 million during this period, while Binance and Bybit suffered losses of about $11 million and $2 million, respectively.
The largest single liquidation order was carried out on OKX, involving a BTC-USDT-SWAP valued at $22.24 million.
CoinGlass data indicates that Bitcoin (BTC) was at the heart of this liquidation storm, with over $115 million in liquidated positions.
Traders who were shorting the largest crypto asset by market capitalization, expecting its price to decline further, were hit the hardest, losing over $66 million within 24 hours.
Conversely, long traders, who had bet on Bitcoin price rising, faced losses of around $49 million.
Moreover, Ethereum (ETH), the second-largest crypto by market capitalization, was not spared.
Over $50 million in Ethereum positions were liquidated.
Interestingly, the impact of the liquidation was more severe on long traders, who incurred losses of nearly $34 million, compared to short traders who lost just over $17 million.
Other Cryptocurrencies Affected
Other cryptocurrencies such as Solana (SOL) and Notcoin (NOT) collectively faced more than $32 million in liquidations over the weekend.
These figures demonstrate the broad-based sell-off that affected a wide range of digital assets.
This recent wave of liquidations follows closely on the heels of one of the largest liquidation events in Bitcoin’s history, which occurred on Friday, July 5.
According to data from CoinGecko, Bitcoin derivatives traders experienced a massive liquidation of $226 million, making it the highest liquidation since the collapse of FTX in November 2022.
This liquidation shook the entire crypto market, with the meme coin sector bearing the brunt of the losses.
Meme coins based on the Ethereum layer-2 scaling solution Base shed about 25.2% of their market value on Friday.
CoinGecko reported that digital assets in the meme category such as Brett (BRETT), Toshi (TOSHI), Degen (DEGEN), Basenji (BENJI), and ChompCoin (CHOMP) suffered significant losses ranging from 19% to 30% of their value.
Causes of Market Liquidations
This market volatility could be attributed to several factors, including aggressive leveraged trading, massive sell-offs, sharp price movements, and cascading stop-loss orders.
Over the past weeks, the German government has been offloading its Bitcoin holdings to different exchanges, including Coinbase and Kraken.
The country plans to sell about 50,000 bitcoins and has been quietly moving the assets in batches since June.
The crypto assets were confiscated in January 2024 from a piracy website in 2013 that violated the country’s Copyright Act.
In addition to the German government, Japanese exchange Mt. Gox, which was exploited for hundreds of bitcoins worth close to $460 million in 2014, and now close to $9 billion has finally started repaying victims of the incident after a decade of waiting.
