In a dramatic turn, the cryptocurrency market has experienced a significant downturn, with bullish investors facing losses totaling approximately $770 million in the past 24 hours. Bitcoin, the flagship cryptocurrency, has dipped below the $100,000 mark, triggering a cascade of declines across major digital assets.
Leading the downturn, Solana’s SOL and Dogecoin (DOGE) have each plummeted over 10%, while Ethereum (ETH), Binance Coin (BNB), Ripple’s XRP, and Cardano’s ADA have each seen reductions of up to 9%. This collective decline has resulted in an 8.5% decrease in the overall cryptocurrency market capitalization as of Monday afternoon in Asian markets.
The downturn extends beyond the top-tier cryptocurrencies. Tokens outside the top twenty, spanning various sectors, are experiencing similar declines. Notably, memecoin Pepe (PEPE), layer 1 blockchain Aptos (APT), Gate.io’s GATE token, and AI agent creation platform Virtuals (VIRTUALS) have each suffered losses reaching up to 18%.
Amid this widespread decline, Jupiter’s JUP token stands out as a rare exception, registering a 3.5% gain over the past day. This uptick follows the platform’s decision to repurchase tokens from the open market using fees generated on its trading platform—a move projected to contribute hundreds of millions in net buying volumes annually.
Bitcoin’s descent below $99,000 early Monday is attributed to traders securing profits ahead of the year’s first U.S. Federal Open Market Committee (FOMC) meeting. This movement mirrors losses in U.S. stock futures, as market participants process information regarding the cost and capabilities of China-based DeepSeek, which challenges the prevailing narrative led by OpenAI.
Futures markets have mirrored these losses, with traders in Bitcoin-tracked products incurring $238 million in losses over the past day, primarily during early European and Asian afternoon trading sessions. Combined losses in SOL and DOGE positions amount to $50 million, while altcoin-tracked products have seen $138 million in losses, and Ether-tracked futures have faced $84 million in losses. The most substantial single liquidation order was recorded on HTX—a tether-margined Bitcoin trade valued at $98.4 million.
Liquidation occurs when a trader lacks sufficient funds to maintain a leveraged position. Given the high volatility inherent in the cryptocurrency market, such liquidations are common. However, significant events like Monday’s downturn can offer actionable insights into market sentiment and positioning.
These liquidation events may indicate an overstretched market, suggesting that a price correction has taken place. Price-chart areas with high liquidation volumes can serve as support or resistance levels, where prices might reverse due to the absence of further selling pressure from liquidated positions.
Should the market continue its decline, traders holding short positions might interpret this as validation, potentially increasing their bets. Conversely, contrarian investors might view substantial liquidation events as buying opportunities, anticipating a price recovery once the selling momentum diminishes.
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