This week, in the UTC+8 time zone, the cryptocurrency market experienced a sudden and severe systemic decline, with mainstream coins like BTC and ETH collectively breaking through key support levels, leading to a comprehensive weakening of technical patterns and sentiment expectations. After the price lost critical ranges, a wave of liquidations and deleveraging worth hundreds of millions of dollars occurred across the network in a short period, with long positions being concentratedly liquidated, forcing the market into a rapid reduction mode. This round of volatility is not an isolated price event but rather the result of a shift in macro expectations combined with a high-leverage structure amplifying downward fluctuations: against the backdrop of tightening interest rates and liquidity expectations, the high-leverage and high-volatility characteristics of the cryptocurrency market were prominently exposed. This article will focus on three main lines: the loss of key price levels, the spread of liquidation chains, and the retreat of cross-market liquidity, to explain the story of this deleveraging phase and the critical moment for Bitcoin.
Key Support Lost: From 75,000…
● Key price level lost: In this round of decline, BTC broke below the $75,000 line, a short-term key psychological and technical support level emphasized by analysts, directly triggering a chain reaction. Above this price level, a large number of trend-following long positions and strategies were accumulated; once it was breached, algorithmic trading and risk control models would simultaneously shift to "reduce positions" and "close longs," amplifying the initial selling pressure and becoming the starting point for subsequent cascading sell-offs.
● Institutional cost breached: According to data from a single source, the BTC holding cost for institutions like Strategy is approximately $76,037 per coin, and this round of decline briefly pierced this cost zone. The breach of institutional cost levels itself has a strong emotional amplification effect: the market interprets it as "smart money also being trapped," triggering more follow-up stop-losses and position compressions; meanwhile, the institutions' own risk control triggers would also lead to active position reductions in this area, further suppressing prices.
● Mainstream coins breaking down together: The loss of BTC's key level is not an isolated case; ETH and other mainstream coins also simultaneously broke through their respective important ranges, putting overall market capitalization under pressure. Since ETH is the underlying asset for a large amount of DeFi collateral and on-chain derivative structures, its price range being breached would instantaneously amplify the passive liquidation pressure across the entire market through multiple paths such as staking, lending, and derivative margins, transforming "Bitcoin's decline" into a "systematic market pullback."
● Technical and psychological resonance: When psychological thresholds and technical support levels are simultaneously breached, automated trading systems will trigger programmed selling based on preset conditions, while manual traders, to avoid margin calls and forced liquidations, will also actively cut positions. The overlap of technical signals, risk control, and human emotions at the same moment magnifies what could have been a controllable adjustment into a rapid decline, guiding the market into a negative feedback loop of "whoever steps in falls."
$400 Million Liquidation Vortex: High Leverage…
● Scale of liquidations and data sources: According to single-source statistics, the total liquidation scale across the network in this round of market activity was estimated to be between $420 million and $520 million, reflecting the concentration of deleveraging. This metric is not an authoritative statistic validated by multiple sources but still holds trend reference value: the clearing of hundreds of millions of dollars in margin in a short time means that a large number of leveraged long positions were forced to exit simultaneously, shifting the market from high leverage to passive deleveraging.
● Short-term cascading characteristics: Also according to single-source data, the total liquidation amount across the network in the past hour was approximately $164 million, with the decentralized contract platform Hyperliquid experiencing a maximum single liquidation of about $15.464 million, showing significant characteristics of concentrated sell-offs. High-value forced liquidation orders often mean that large leveraged positions are wiped out in one go, directly smashing new price lows and triggering risk control models on other platforms, increasing maintenance margin requirements and amplifying systemic selling pressure.
● Formation of liquidation bands: Data from Trend Research (also a single source) shows that mainstream ETH collateral liquidation ranges are highly concentrated around $1,781.09–$1,862.02. This "liquidation band" means that a large number of forced liquidation prices are squeezed into a relatively narrow range; once the market touches it, it will trigger a series of chain liquidations. Each batch of positions being forcibly liquidated will further lower prices, pushing the next layer of collateral and leveraged positions into the forced liquidation trigger zone, creating a rolling chain effect.
● From individual liquidations to systemic spirals: The high-leverage liquidation of a single trader is not enough to shake the overall market; what is truly fatal is the systemic synchronization of liquidation logic. When prices break through key levels and trigger the first batch of forced liquidations, market liquidity is already thinning, and subsequent forced liquidation orders must transact at worse prices, further dragging down the market. In this process, the liquidation bots of staking and lending protocols, the forced liquidation mechanisms of centralized exchanges, and manual panic selling overlap, amplifying "individual position risks" into a "systemic liquidation spiral," causing secondary and even multiple impacts on the market.
Macro Winds Shift: From Precious Metals Crash…
● Signals of precious metals crash: This round of cryptocurrency asset pullback is not an isolated fluctuation of a single asset but occurred simultaneously with the plummeting prices of precious metals. Multiple research reports indicate that against the backdrop of shifting macro policy expectations, precious metals and a basket of risk and hedging assets, including cryptocurrencies, are under pressure simultaneously, indicating that funds are not simply rotating between assets but are undergoing an overall deleveraging and retreat from high-volatility exposures.
● Clearing under tightening macro expectations: Research institutions generally define the current market situation as a "deleveraging process under tightening macro expectations." The market is beginning to reprice future interest rate paths and the dollar liquidity environment, with a decreasing tolerance for long-term high-volatility bets, forcing high-leverage ecosystems like the cryptocurrency market to be prioritized for position reductions. The rapid adjustment in prices is essentially a concentrated clearing and repricing of the "high-leverage structure accumulated under previous easing expectations."
● High sensitivity to interest rates and the dollar: Compared to traditional assets, the high leverage and high volatility of cryptocurrency assets make them more sensitive to changes in interest rate expectations and dollar liquidity. When the market shifts from "easing expectations" to "concerns about tightening," marginal funds are more inclined to flow back to cash and low-risk assets, prioritizing the reduction of high-leverage positions. Each time the cryptocurrency market amplifies a bearish reaction, it is essentially a forward-looking reflection of "rising funding costs" and "tightening financing environments."
● The illusion of easing shatters: For a period, the market had bet on the possibility of continued easing in future policies, supporting the strong performance of cryptocurrency assets. The current turning point is that the narrative of easing has been replaced by concerns about tightening, and this macro wind change quickly penetrates the price curve through expectations and emotional channels. Prices do not simply reflect the present but are using violent fluctuations to "prepay" for future policy paths, which is why subtle changes in macro tone can trigger significant shocks in the cryptocurrency market.
Liquidity Retreat: Shrinking Stablecoin Market…
● Shrinking stablecoin market capitalization: According to briefing data, the total market capitalization of stablecoins decreased by approximately $4.049 billion within a week, which visually shows that the "long ammunition" available for building positions and leveraging in the market has significantly declined. As the foundational settlement asset for trading and leverage systems, the contraction of stablecoin scale means a decrease in incremental buying capacity; even if prices experience a temporary decline, the buying support is hard to form.
● Cross-market risk appetite cooling: Under the dual pressure of tightening macro expectations and increasing volatility, overall risk appetite is declining, with funds flowing back from high-beta cryptocurrency assets to cash and low-risk assets. This change in cross-market risk appetite is not a short-term sentiment but part of a structural reallocation of funds: high-volatility, high-leverage assets are under pressure, while low-volatility, more liquid assets gain relative advantages, making the cryptocurrency market passively become the main outlet for "risk reduction."
● Resonance of leverage liquidation and spot selling pressure: When the contraction of stablecoins and futures liquidations occur simultaneously, liquidations are no longer just paper losses at the contract level but will transmit through multiple paths to spot selling pressure. On one hand, forced liquidations need to sell underlying assets in the spot or perpetual markets to recover margins; on the other hand, the behavior of being forced to sell other holdings to cover margin shortfalls will also spread to a wider range of cryptocurrencies. The result is that price volatility is further amplified, escalating from a "contract market event" to a "full market liquidity event."
● Dissecting the liquidity chain: The essence of this round of volatility is that the complete liquidity chain from leverage liquidation to spot selling pressure was straightened out in a short time. Key price levels breached → leveraged positions liquidated → decreased stablecoin demand and increased redemptions → shrinking stablecoin market capitalization → new buying funds in short supply → lack of buying support for spot selling pressure → further price declines, which in turn trigger a new round of liquidations. Understanding this chain is far more important than attributing the event to a single market or platform.
Moral Shadows and Price Manipulation Doubts…
● Old files resurfaced: Against the backdrop of amplified volatility and concentrated liquidations, the old news from the Epstein files regarding his discussions with Bitcoin developers about ethical concerns of price manipulation has been brought up again in the market. This file dates back to 2018 and records their discussions around price manipulation, market fairness, and the boundaries of technologist responsibility, which are now being circulated again, adding a layer of "conspiracy and morality" to an already tense emotional landscape.
● Sensitivity to fairness amplified: Extreme volatility and large-scale forced liquidations always heighten the market's sensitivity to price fairness and matching transparency. When retail investors encounter massive liquidations in a short time, emotions can easily shift from "risk is self-borne" to questioning "if someone is manipulating behind the scenes." Each high-leverage sell-off adds new cases to the existing distrust, bringing the discussion around "whether prices are manipulated" back to the center of public opinion.
● The cyclical narrative of history: From "big players controlling the market" to "black box trading" and "exchange algorithms killing longs and shorts," the narrative of manipulation is almost reactivated during every round of market crashes. Such narratives often blend real structural imbalances (like concentrated large leverage and insufficient liquidity depth) with unverified conspiracy stories, providing investors with an "emotional outlet." They may not necessarily explain all price movements but genuinely shape market participants' psychological expectations regarding risks and counterparties.
● Background material rather than evidence: It is important to emphasize that the Epstein files are more background material for understanding the early development of Bitcoin and ethical controversies, rather than evidence of direct manipulation in the current market situation. Equating it simply with current price fluctuations lacks sufficient factual support and can easily obscure the true sources of risk—changes in macro expectations, high-leverage structures, and liquidity retreat. Maintaining a focus on structural risks is more helpful for understanding and responding to market volatility than indulging in unverified manipulation narratives.
After Deleveraging: Chip Handovers and Down…
This round of decline resembles a concentrated clearing and redistribution of chips under the pressure of tightening macro expectations against the backdrop of previously stacked high-leverage structures. From BTC breaking below $75,000, to the brief piercing of the institutional cost level of $76,037 for entities like Strategy, and then to the concentrated sweep of ETH collateral positions in the $1,781–$1,862 liquidation band, behind the price fluctuations is a batch of leveraged funds being cleared, with chips flowing from high-leverage hands to holders more resilient to volatility.
In the short term, key price levels and liquidation ranges will remain the main battleground for bulls and bears. Market narratives will revolve around "whether a certain price level can be regained" and "whether a certain range will trigger forced liquidations again," with technical patterns and on-chain liquidation data continuing to shape the emotional tone. Until liquidity has not clearly returned, any fluctuations approaching these sensitive price levels may be amplified into a new round of emotional outbursts.
From a longer-term perspective, the rhythm of stablecoin contraction and the speed of risk appetite recovery will determine whether the upcoming rebound is merely a technical pullback after a deep decline or the starting point of a new upward cycle. If the market capitalization of stablecoins continues to decline and new funds are limited, then the rebound is more likely to be constrained by the existing capital game; conversely, if macro expectations ease and off-market funds return, the cryptocurrency market may reignite a trending rally.
It is important to note that the data cited in this article regarding liquidation scales, liquidation ranges, and other metrics mostly come from single sources and retrospective statistics, primarily used to depict the profile of phase risks rather than providing definitive guidance for future trends. At this critical moment of deleveraging, maintaining a reverence for uncertainty—acknowledging limited information and multiple pathways—is more important than being fixated on a single prediction.
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