The crypto market succumbed to a wave of selling pressure and liquidations on Thursday with bitcoin tumbled to about $61,300 at 02:00 UTC before recovering to as high as $64,680. It recently traded around $62,500.
Ether (ETH) lost 3% since midnight UTC and is now trading at around $1,750. Several other altcoins saw deeper declines, with NEAR, ZEC and JUP all losing more than 13%.
The downward movement triggered a wave of liquidations, with $1.7 billion of futures positions forced out due to the slide, $750 million of which is attributable to bitcoin, $390 million to ether.
Investors appear to be abandoning crypto to pursue the AI narrative in traditional markets, compounding geopolitical uncertainty and a fundamentally fractured market structure that has failed to recover from October’s leverage wipeout.
Derivatives positioning
- Total 24-hour futures volume rose 2.9% to $305 billion, an increase that reflected heightened but not panicked activity. More tellingly, open interest, which fell 8.5% to $111.4 billion, is a sign that leveraged positions are being liquidated rather than adding new bets.
- Liquidations have been severe: About $3 billion in leveraged positions have been wiped out over the past two days, with the 24-hour figure alone reaching $1.7 billion.
- Bitcoin’s open interest has pulled back to 766,000 BTC from yesterday’s record high of over 800,000 BTC. The decline suggests that the price dive has washed out a significant portion of leveraged longs and that bears are not aggressively building new directional bets, at least not in BTC. The same dynamic applies to ether (ETH) and XRP.
- Solana is a notable exception. Open interest in SOL rose to a record 72.16 million tokens even as prices fell, a combination that typically signals an influx of short positions. The sentiment is understandable as SOL fell below February lows while BTC, ETH and XRP held above theirs.
- TRX and ADA are also seeing open interest rise as their prices fall, suggesting similar short-side accumulation in these markets.
- Derivatives’ broader tone confirms the bearish tilt. The 24-hour cumulative volume delta across the top 20 tokens is negative, meaning traders are selling at market prices rather than limit orders. This active, aggressive bearish participation suggests the potential for deeper losses.
- The implied volatility increases in parallel. Volmex’s 30-day implied volatility indices for bitcoin (BVIV) and ether (EVIV) have risen over the past three sessions, reflecting rising demand for options-based hedging and heightened expectations of continued price volatility.
- Put biases have strengthened in both bitcoin and ether, signaling that investors are willing to pay a premium for downside protection. The $60,000 strike on Deribit carries over $1 billion in theoretical open interest. As spot prices approach that strike, large position adjustments become increasingly likely, which can amplify volatility.
- The $55,000 put was the most actively traded options contract in the last 24 hours. The message from the derivatives markets is unequivocal: the mood is bearish.
Token talk
- The altcoin market underperformed the crypto majors on Thursday. Even the latest beloved HYPE lost 12% after hitting an all-time high earlier this week.
- DASH, ENA and FET also fell by more than 10% since midnight UTC as the lack of liquidity in altcoin pairs reared its head again.
- Market depth is typically much lower on altcoin pairs than on bitcoin or ether, so the amount of capital needed to move prices in either direction is relatively low. Couple that with a wave of liquidations and the asset simply cannot sustain the supply level, causing excessive price movements to the downside.
- Monero (XMR), despite falling 4% since midnight, is still in the black over 24 hours. Trading at $347, it appears unfazed by the broader market crash.
- Much of the altcoin trajectory will depend on bitcoin’s ability to hold above $60,000. A break below that could trigger further liquidations, weighing more heavily on the illiquid altcoin pairs.
