Cryptocurrency Market Volatility Triggers $318.83 Million Liquidation in 24 Hours

The global cryptocurrency derivatives market experienced a turbulence-filled 24-hour period, resulting in a staggering $318.83 million (approximately 437.5 billion won) in liquidations, according to data from October 20. This spike in liquidations followed heightened market volatility triggered by a sharp rally the previous day, leading to widespread losses in both long (buy) and short (sell) positions.

Over 116,000 Traders Affected by Market Wipeout

CoinGlass data reveals that 116,312 traders were impacted by this massive wave of liquidations. Of the total amount, $136.54 million (approximately 188.7 billion won) came from long positions, while $179.89 million (approximately 248.8 billion won) were liquidated from short positions. Notably, short positions comprised 56.8% of the liquidations, underscoring a swift and sizable shift in market dynamics.

Leading Cryptocurrencies See Largest Liquidation Totals

Bitcoin (BTC) and Ethereum (ETH) emerged as the most significantly affected assets during the period. Bitcoin led the pack, with $105.11 million in positions liquidated, while Ethereum saw $93.59 million in losses. These two powerhouse cryptocurrencies collectively accounted for around 65% of the total liquidations, underscoring their dominant role in shaping market sentiment.

The impact extended to other major cryptocurrencies:

• Solana (SOL): $17.61 million liquidated (approximately 2.43 billion won)
• XRP: $10.84 million liquidated (approximately 1.5 billion won)
• Dogecoin (DOGE): $9.83 million liquidated (approximately 1.36 billion won)
• Aave (AAVE): $7.44 million liquidated (approximately 1.03 billion won)

These figures illustrate the widespread influence of volatility across the cryptocurrency landscape.

Liquidations Peak Over a 12-Hour Span

A closer look at the liquidation data across varying time intervals reveals some sharp increases:

• 1-hour liquidations totaled $4.61 million.
• Over 4 hours, the figure jumped to $67.72 million.
• The most significant activity occurred in the 12-hour timeframe, with $133.85 million wiped out.
• The full 24-hour period saw total liquidations reach $318.83 million.

The pronounced spike in the latter half of the day points to intensifying market instability and a concentration of exit points as traders sought to mitigate losses and manage risks.

Trading Volume and Market Liquidity Surge

Despite the high volatility, market liquidity indicators showed positive movement. Total 24-hour trading volume climbed to $260.9 billion (approximately 360 trillion won), marking a robust 59.28% increase from the preceding day. Open interest also showed a slight uptick, rising 1.68% to reach $148.7 billion (approximately 205 trillion won). Analysts suggest this rise was driven by liquidation of short-term short positions, potentially fueling additional liquidity in the marketplace.

Investor Sentiment Remains Subdued

While trading activity saw an uptick, investor sentiment remained cautious. According to the Fear and Greed Index tracked by Alternative.me, sentiment stayed firmly rooted in the 'Fear' range, holding steady at 29 points—a stark contrast to last week’s reading of 38 and last month’s level of 48. Persistent bearish sentiment indicates traders remain wary, likely influenced by recent volatility and liquidation events.

Conclusion: A Market in Flux

The last 24 hours provided a striking example of the inherent volatility in the cryptocurrency market. With over $318.83 million liquidated across major assets and tens of thousands of traders impacted, the market’s unpredictability remains a challenge for investors. However, the spike in trading volume and liquidity suggests that these fluctuations may also create short-term opportunities for participants with high-risk tolerance and agile strategies. As sentiment stays muted within the 'Fear' zone, cautious optimism could guide trading decisions until further stabilization materializes. For now, navigating this dynamic market will require vigilance and an understanding of its fast-paced nature.