Crypto Markets Collapse: $1.84 Billion Liquidation Event Rocks Digital Assets

Cryptocurrency markets experienced their largest liquidation event since February 5, with $1.84 billion in leveraged positions wiped out in 24 hours. Bitcoin dropped below $66,000 and Ethereum fell under $1,900 as panic selling surged, overwhelming bullish traders with $1.66 billion in liquidations compared to just $180 million in short positions. Bitcoin alone saw $883.66 million in long liquidations, including a $59.67 million BTC-USDT trade on HTX, while Ethereum and Solana also faced significant losses. Binance led liquidations with $748 million, or 41% of the total, followed by Hyperliquid ($314 million) and Bybit ($247 million). Over 224,500 traders were liquidated, yet Bitcoin’s open interest rose from 759,000 to 788,600 BTC, signaling increased short positioning. Retail traders remain bullish on exchanges like Binance (long-to-short ratio of 2.22), but large accounts on OKX show extreme bearishness with a 0.54 ratio. The downturn stems from escalating U.S.-Iran tensions, including Iran’s threat to block the Strait of Hormuz, pushing Brent crude to $93.89 per barrel. Rising oil prices and geopolitical uncertainty drove capital toward safe-haven assets, draining liquidity from crypto markets. Bitcoin ETFs saw $3.5 billion in outflows over 10 trading sessions, while Tether’s $14 million BTC transfer further fueled selling pressure. Despite the volatility, Bitcoin’s weekly decline reached 12%, reflecting broader market stress. The liquidation surge underscores crypto’s sensitivity to external shocks, with institutional and retail traders alike reacting to geopolitical risks and shifting capital flows.