The cryptocurrency market faced a massive liquidation wave, with over $1.7 billion wiped out in just 24 hours, causing a significant drop in market cap and impacting countless traders globally.

The Extent of the Liquidation

Record-breaking losses across the market
According to CoinGlass data, Dec. 10 marked one of the most significant liquidation days this year. Over $1.53 billion was liquidated from long positions, while $155 million came from shorts. Small-cap cryptocurrencies bore the brunt of the losses, with $564 million liquidated, including $543 million in long positions. Over half a million traders faced losses during this single trading day.

Major Players in the Liquidation Wave

Ethereum and Bitcoin among top affected assets
Ethereum suffered $235 million in liquidations, with a steep 7% drop, bringing its value to $3,686. Bitcoin, too, experienced $182 million in liquidations, dropping to $96,652, well below the critical $100,000 psychological mark. Binance led the platforms with $739 million in liquidations, followed by OKX and Bybit, highlighting the widespread market impact.

Market Impact: A Shrinking Market Cap

A turbulent day for crypto markets
The cryptocurrency market cap plummeted by 6.62%, dropping to $3.44 trillion. Interestingly, market trading volume surged by 113%, reaching $313 billion, reflecting increased activity amid the downturn. Ethereum-USDT pairs on Binance saw the largest single liquidation at $19.69 million, underscoring the volatility of leading trading pairs.

Historical Context of Liquidations

The largest losses since 2021
This recent wave of liquidations ranks as the largest since 2021, marking a turbulent year for cryptocurrency markets. While small-cap cryptocurrencies led the current crash, liquidations have been steadily rising, suggesting increased participation from new traders.

What’s Next for Crypto Markets?

A volatile but resilient ecosystem
As market participants assess the fallout, this event highlights the high-risk nature of cryptocurrency trading. Despite the downturn, the crypto market remains a dynamic space, attracting both experienced and new traders. The question now is how markets will stabilize and what lessons can be learned from this significant liquidation event.