The cryptocurrency market has been a rollercoaster of volatility over the past week, with liquidations totaling over $2 billion as prices of major tokens like Bitcoin (BTC), Ethereum (ETH), and XRP experienced sharp swings.
The past 24 hours alone saw more than $435 million in forced closures, driven by macroeconomic uncertainties and shifting market sentiment.
This wave of liquidations has left traders reeling, with both bullish and bearish positions caught in the crossfire, signaling potential turning points in the market.
A Week of High-Stakes Volatility
From May 30 to June 5, 2025, the crypto market witnessed a series of dramatic price movements, triggering massive liquidations across centralized exchanges.
According to data from CoinGlass, the week began with a significant downturn on May 30, when total liquidations reached $841 million in a single day, with $747 million coming from long positions.
Bitcoin, trading near $104,000 after hitting a peak of $111,814 the previous week, was the epicenter of the carnage, contributing $222 million to the liquidation tally, followed by Ethereum at $122 million.
The sell-off was exacerbated by external factors, notably U.S. President Donald Trump’s tariff policies.
Reports of a court staying a ruling that blocked Trump’s tariffs on Chinese steel and aluminum rattled global markets, with crypto feeling the ripple effects.
The total crypto market capitalization fell by 2.6% to $3.34 trillion on May 30, breaking below a key technical support level at $3.35 trillion, according to Cointelegraph.
This breach signaled heightened selling pressure, with $683.4 million in futures liquidations, of which $617.85 million were long positions.
On May 31, the market saw another wave of liquidations totaling $600 million as Bitcoin dipped below $104,000, marking the highest single-day losses since February.
CoinDesk reported that 89% of these liquidations hit bullish traders, reflecting an overly optimistic market caught off-guard by the price drop.
Analysts noted that such cascades often indicate market extremes, potentially foreshadowing a price reversal due to overshot sentiment.
The Past 24 Hours: $435 Million Wiped Out
The volatility persisted into the past 24 hours, with posts on X reporting $435 million in liquidations across major cryptocurrencies.
Ethereum led with $78 million, followed by Bitcoin at $70 million, Solana (SOL) at $25 million, Dogecoin (DOGE) at $14 million, and other altcoins accounting for $248 million.
This data, shared by @RoundtableSpace citing @blocknewsdotcom, underscores the broad-based impact of the market’s latest convulsions.
The recent liquidations were driven by continued uncertainty around macroeconomic factors, including fears of renewed trade tensions and anticipation of upcoming U.S. Consumer Price Index (CPI) data releases.
These factors have kept traders on edge, with leveraged positions proving particularly vulnerable.
For instance, XRP faced significant downside pressure, trading at $2.17 on May 30 after a pullback that triggered $30 million in liquidations, predominantly from long positions.
A 40% surge in trading volume and an 11% drop in derivatives Open Interest signaled heightened volatility, according to FXStreet.
Trending: IRS now delays crypto tax reporting requirements until 2026
Market Sentiment and Technical Outlook
The heavy liquidations reflect a market caught in a tug-of-war between bullish optimism and bearish corrections.
Posts on X from May 23 highlighted earlier market dynamics, with $300 million in long positions liquidated in a single hour, followed by $308 million in short liquidations as prices rebounded.
These rapid shifts illustrate the dangers of leveraged trading in a volatile environment.
From a technical perspective, the crypto market’s total capitalization is at risk of falling toward $3.1 trillion after breaking below a descending parallel channel, as noted by Cointelegraph.
The $3.22 trillion level is a critical support to watch, with a breach potentially triggering further declines.
Bitcoin’s struggle to hold above $104,000 ($101.4K at the time of this writing) and Ethereum’s dip below key psychological levels like $2,000 have added to the bearish outlook.
However, some analysts see a silver lining.
CoinDesk suggested that the scale of liquidations could indicate a market turning point, where excessive bullish or bearish sentiment is flushed out, paving the way for a potential rebound.
The crypto market’s resilience was evident earlier in the week, with Bitcoin briefly surpassing $104,800 before pulling back, despite a $483 million liquidation event on May 12 that included a staggering 3,100% imbalance in Bitcoin long-to-short liquidations.
Also Read: XRP Price Analysis: Can It Break $3 or Drop to $1 in 2025?
Broader Implications and Trader Caution
The past week’s liquidations highlight the risks of leveraged trading in the crypto space, where rapid price swings can wipe out positions in hours.
The involvement of over 162,000 traders in a $374 million liquidation event on April 30, including a 5,438% imbalance in XRP liquidations, underscores the market’s susceptibility to cascading stop-losses and margin calls.
External factors, such as Trump’s tariff policies and geopolitical tensions, continue to weigh on speculative assets like cryptocurrencies.
The market’s reaction to these events, combined with technical breakdowns, suggests that volatility will persist in the near term.
Traders are advised to exercise caution, with analysts like Jeff Mei from BTSE pointing to upcoming Federal Reserve decisions as potential catalysts for Bitcoin’s next move.
The crypto market’s recent wave of liquidations, totaling over $2 billion in the past week and $435 million in the last 24 hours, reflects a perfect storm of macroeconomic uncertainty, technical breakdowns, and over-leveraged trading.
As Bitcoin hovers around $101,000 and altcoins like Ethereum, XRP, and Solana face significant pressure, the market remains on edge.
While some see these liquidations as a sign of a potential reversal, the immediate outlook is one of caution, with traders bracing for further volatility ahead of key economic data releases.
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