Bitcoin and Ethereum Experience Steep Drop, Leading to Unprecedented $1.7 Billion Liquidation at the Start of the Week

Crypto values plummeted sharply during trading hours in Asia, erasing almost 4% of the market capitalization in a single session.

Bitcoin led the decline, dropping over $4,000 within the last day to settle around $112,000 at the time of reporting, based on CryptoSlate’s data.

In addition to BTC, Ethereum fell 7% to $4,163, and XRP decreased by more than 6%, trading at roughly $2.82.

Other major cryptocurrencies, such as Solana, Dogecoin, and BNB, also experienced declines exceeding 6% during this timeframe.

This widespread drop represents the first significant correction after weeks of consistent gains that had pushed digital assets to all-time highs.

The rapidity of the decline took many traders by surprise, although several analysts had already pointed out potential risks.

Joao Wedson, the founder of blockchain analytics platform Alphractal, stated that Bitcoin is exhibiting clear signs of cycle exhaustion. He referred to the SOPR Trend Signal, which monitors on-chain realized profitability, as an indication that investors are purchasing at historically high levels where profit margins are diminishing.

Wedson detailed that Bitcoin’s realized price for short-term holders is currently at $111,400, a point that institutions should have positioned themselves at much earlier. He also observed that Bitcoin’s Sharpe Ratio, which gauges returns relative to risk, has decreased compared to 2024.

In light of this, he remarked:

“Those who invested in BTC at the end of 2022 are pleased with a +600% return, but those accumulating in 2025 ought to rethink their strategy.”

$1.7 billion liquidation

The abrupt price adjustment has triggered the largest liquidation event seen this year.

Data from Coinglass indicates that $1.7 billion worth of leveraged positions were liquidated in the last 24 hours, predominantly impacting long traders. Losses from bullish positions amounted to $1.6 billion, while short positions lost $83 million.

Ethereum traders bore the brunt of the losses, facing liquidations totaling $498 million, followed by Bitcoin at $284 million. XRP and Solana also had positions liquidated worth $78 million and $95 million, respectively.

These numbers reflect the inherent volatility of the cryptocurrency markets. When leverage accumulates during upward trends, a swift correction can erase billions in unrealized earnings.

This sudden downturn emphasizes why traders, especially institutional ones, continue to exhibit caution in this evolving industry, even amidst growing adoption.

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