$367 Million Crypto Longs Flushed After Altcoin Market Crash

Altcoin Longs Witness Squeeze, Ethereum Leads Liquidations

The cryptocurrency market has experienced volatility in the past day, with altcoins facing drops of over 5%. This turbulence has led to significant liquidations in the derivatives market.

According to CoinGlass data, approximately $429 million worth of contracts were liquidated within the last 24 hours. Liquidation occurs when a platform forcibly closes a contract due to excessive losses.

As the table below illustrates, long contract holders experienced the majority of these forced closures during the day. Around $367 million of liquidations, representing over 85% of the total, involved traders anticipating a bullish market outcome.

This liquidation asymmetry stems from the overall downward trend in cryptocurrency prices.

Below is a heatmap indicating the contributions of individual assets to this latest derivatives flush:

Unlike typical violent liquidation events, Ethereum (ETH), not Bitcoin (BTC), leads the charts. This is likely attributed to ETH's 3% drop compared to BTC's sideways movement. Memecoins Dogecoin (DOGE) and Shiba Inu (SHIB) follow ETH, with liquidations amounting to $60 million and $23 million, respectively.

DOGE and SHIB are known for their sharp plunges and speculative activity, explaining their high liquidation volumes.

A mass liquidation event is known as a "squeeze," characterized by a cascade of liquidations and increased volatility. This latest event, dominated by long liquidations, is referred to as a "long squeeze."

Squeezes are common in the cryptocurrency market due to volatility, but an altcoin-dominated squeeze of this magnitude is unusual.

As a result of this plunge, ETH has dropped to around $3,400.