$1.3 Billion Liquidated as Bitcoin Crashes Below $104K
Global Crypto Market Crash Deepens as Liquidations Hit $1.3 Billion and Fear Spreads
The global cryptocurrency market has entered a new wave of volatility, with prices plunging sharply over the past 24 hours. Total market capitalization dropped by 4.4%, sliding from $3.45 trillion to $3.3 trillion, extending the month’s losses to nearly 18%. Analysts say this latest decline reflects a combination of factors: aggressive liquidations, uncertainty over Federal Reserve policy, and mounting investor anxiety triggered by exchange-traded fund (ETF) outflows.
Liquidity Turmoil Sends Mixed Signals
In a move that stunned Wall Street and crypto traders alike, the U.S. Federal Reserve injected $29.4 billion into the banking system through overnight repurchase agreements (repos) — the largest single-day liquidity operation since the early 2000s. While such interventions are typically aimed at easing financial stress, this time they raised new concerns about the underlying health of the financial system.
Simultaneously, the People’s Bank of China (PBoC) carried out a record cash injection into its domestic markets, further amplifying speculation that global liquidity pressures may be building.
“Under normal circumstances, this kind of injection is bullish for risk assets,” explained crypto analyst Daniel Franks of GlassWave Analytics. “But when both the Fed and China’s central bank act on the same day, it tells us they’re responding to cracks in the financial system — not stimulating for growth.”
The timing of the Fed’s move also sowed confusion among traders. Fed Governor Christopher Waller hinted at a potential December rate cut, yet Fed Chair Jerome Powell remained cautious in his tone, emphasizing inflation risks. This policy split has reduced the odds of a December cut from 90% to just 67%, according to CME FedWatch data — leaving markets unsure whether the liquidity support will continue or tighten again.
Bitcoin Falls Below $104K Amid Mounting ETF Outflows
Bitcoin, the world’s largest cryptocurrency, failed to hold its psychological support level of $104,000, triggering a wave of panic selling. The decline was accelerated by massive outflows from U.S. spot Bitcoin ETFs, which recorded $186.5 million in net withdrawals in a single day and nearly $946 million for the week.
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| Source: X |
Institutional traders, who had been net buyers earlier in the month, shifted toward risk-off positions as fears of a possible U.S. government shutdown resurfaced. Treasury yields also climbed, signaling that investors were rotating out of speculative assets.
“The ETF outflows show that even institutional confidence is shaking,” said Mira Patel, head of digital asset strategy at Aegis Capital. “There’s a growing sense that this isn’t just a technical pullback — it’s a structural repricing of risk across all markets.”
Ethereum (ETH), Solana (SOL), and other major altcoins mirrored Bitcoin’s decline, with most top tokens losing between 6% and 12% over the same period.
Massive Liquidations Fuel the Downtrend
According to data from Coinglass, over 333,000 traders were liquidated in the last 24 hours, totaling $1.37 billion in forced sell-offs — one of the largest single-day liquidation events since April. A staggering 90% of these positions were long trades, meaning most investors were betting that prices would rise.
The biggest single liquidation occurred on HTX Exchange (formerly Huobi), where a BTC-USDT position worth $47.87 million was wiped out.
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| Source: Coinglass |
In total, Bitcoin accounted for $407 million of the liquidations, Ethereum $355 million, and Solana $156 million, underscoring how quickly leveraged bets can collapse in a declining market.
“This is the classic domino effect,” said quantitative trader Liam Ortega. “Once prices drop below a key level, leverage amplifies the pain. The cascade of margin calls and forced liquidations creates a self-fulfilling crash.”
The surge in liquidations also had a knock-on effect across the decentralized finance (DeFi) sector, where collateral values plummeted and lending pools tightened.
Fear Returns to the Crypto Market
The Crypto Fear & Greed Index, a widely followed sentiment gauge, plunged to 22, deep in the “Fear” territory. The last time it fell this low was during the May 2022 market capitulation following the Terra-LUNA collapse.
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| Source: Coinglass |
Extreme fear readings often signal oversold conditions, but they also highlight widespread uncertainty. Historically, such moments have preceded both major bottoms and deeper selloffs.
“Traders are scared — they’re not buying the dip,” said market psychologist Carla Monroe. “They’re converting to stablecoins, holding cash, and waiting for clarity. The emotional cycle has swung from euphoria to anxiety in just two weeks.”
On-chain data confirms that stablecoin inflows to exchanges have fallen 14% in the past week, a sign that traders are not yet ready to re-enter.
FUD, Whales, and Manipulation Rumors
As the selloff deepened, Binance founder Changpeng Zhao (CZ) warned users about “random FUD” — a term for fear, uncertainty, and doubt — spreading across social media. He suggested that large market players, often called “whales,” were amplifying panic narratives to force liquidations and accumulate crypto at lower prices.
“Always verify information before reacting,” CZ posted on X (formerly Twitter). “Some big players are spreading rumors just to shake out smaller traders.”
Despite his warning, on-chain activity indicated heightened selling by mid-sized wallets, while large whale wallets showed accumulation — a familiar pattern observed in previous market bottoms.
Global Factors and Macro Risks
Beyond crypto-specific triggers, macroeconomic headwinds are amplifying volatility. The strengthening U.S. dollar, rising Treasury yields, and political uncertainty around the federal budget are all putting downward pressure on digital assets.
Emerging market currencies have also weakened, particularly in Asia, where declining risk appetite has triggered capital outflows from local exchanges. The MSCI Emerging Markets Index has fallen 5% in two weeks, further dampening sentiment toward crypto, which is often viewed as a high-risk asset class.
Meanwhile, Chinese regulatory authorities have reportedly increased monitoring of cross-border crypto transactions, a move that could limit arbitrage and slow trading volume in the Asia-Pacific region.
Market Outlook: Volatility to Stay High
Analysts say the coming days could determine whether the market stabilizes or continues to slide. Much depends on whether the Federal Reserve’s liquidity support continues and how inflation data evolves heading into December.
If the Fed signals that it remains ready to ease financial conditions, Bitcoin could rebound toward the $110,000 level. However, if inflation expectations rise again and liquidity injections slow, the selloff could deepen, possibly revisiting the $95,000 zone — a key technical support from earlier this year.
Ethereum’s immediate support sits near $3,500, while Solana faces resistance around $190. Analysts warn that altcoins could face steeper losses if Bitcoin fails to reclaim $104,000 in the coming sessions.
“Volatility is the one constant in crypto,” said analyst Robert Kim of Arcane Digital. “This correction doesn’t mean the bull market is over — but it reminds everyone that leverage is a double-edged sword.”
As of press time, the total crypto market cap remains above $3.3 trillion, though sentiment remains fragile. For investors, the lesson is clear: risk management matters as much as conviction in a market where fortunes can change in a matter of hours.
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