Crypto Bulls Face $644M Bloodbath as Bitcoin Dips Below $105,000

Bitcoin’s price dips below $105,000, leading to $712 million in liquidations, primarily affecting long-position investors. The decrease was significant, with Bitcoin and Ethereum being the top impacted tokens. The situation marks a potential long squeeze, fueled by prior whale activity and volatility in the crypto market.

The cryptocurrency market is reeling from a significant dip as Bitcoin’s price fell below $105,000, causing a massive liquidation wave totaling around $712 million. This situation has affected many investors, with a substantial portion of liquidations hitting those with long positions, primarily due to the bearish shift. The last 24 hours alone witnessed approximately $477 million in crypto contracts being forcefully closed, according to CoinGlass data.

The dramatic shifts in the market are not entirely unexpected, as Bitcoin and various altcoins have been tumbling recently. Over 90% of the long liquidations in this episode seemed to target bullish investors—a phase referred to as a ‘long squeeze.’ A long squeeze happens when a sudden price drop triggers a domino effect of liquidations, amplifying the volatility further.

Bitcoin and Ethereum stood out among the tokens impacted, with liquidations totaling around $221 million and $116 million respectively, marking them as the largest contributors to this unprecedented event. Interestingly, Solana came in third, although lower in market cap, with $32 million in liquidations. Its significant drop likely stems from a sharper decline compared to XRP, which is typically associated with such events.

The downfall for Bitcoin had its roots earlier than the recent drop, with a peak just shy of $112,000 on May 22nd. A report by Santiment revealed this peak coincided with a spike in whale activity on the network. Their analysis tracked the number of transactions exceeding $100,000 and $1 million, which surged earlier in the month—possibly hinting at large investors cashing out before the downtrend commenced.

As of now, Bitcoin has seen a slight recovery from the earlier drop, currently trading around $105,800. The stability remains uncertain as investors navigate through a market that has become increasingly turbulent, raising concerns about the future direction of cryptocurrencies.