Bitcoin Sheds $3B of Leverage in Two Days as Solana Hits a 2023 Low
Roughly $3 billion of leveraged crypto positions were liquidated over two days through Thursday, with $1.5 billion to $1.7 billion of that in the most recent 24 hours across more than 208,000 traders, according to CoinDesk. Bitcoin fell 4.90% to $63,682.64 as of 9:40 a.m. ET, touching an intraday low near $61,300. The decline carried it below $65,878.93, its opening price on Feb. 28, and left it well under Wednesday's close of $66,965.27. Solana fell about 9% on the day to roughly $68.53, its lowest level since December 2023.
The Cascade: $1.5 Billion in a Day Across 208,000 Accounts
Forced closures, not new selling, set the pace of the move. When a leveraged position can no longer meet its margin requirement, the exchange closes it at market, which pushes the price further in the direction that triggered the closure and puts the next tier of positions at risk. Two days of that produced the following, according to CoinDesk and Yahoo Finance:
- Bitcoin: roughly $750 million to $800 million liquidated.
- Ether: roughly $386 million to $390 million.
- Solana: $88.45 million, 94% of it long positions.
- Traders liquidated: more than 208,000 in 24 hours.
The spot market offered little to absorb it. US spot bitcoin ETFs had recorded 13 consecutive sessions of net outflows totaling $4.37 billion since mid-May, CoinDesk reported, leaving the largest structural buyer of the past two years on the sell side throughout the decline.
The Derivatives: Open Interest Down 8.5% to $111.4 Billion
Total open interest, the aggregate value of futures and options contracts still outstanding, fell 8.5% to $111.4 billion. Bitcoin futures open interest dropped from more than 800,000 BTC to 766,000 BTC. Over the same span, 24-hour futures volume rose 2.9% to $305 billion. Falling open interest against rising turnover is the signature of positions being closed rather than opened, and it confirms that the two days removed leverage from the market rather than adding directional exposure to it.
The options book showed where traders were paying for protection. On Deribit, the $60,000 put, a contract giving its holder the right to sell at that strike, held more than $1 billion in notional open interest, and the $55,000 put was the most-traded contract of the session. Notional open interest measures the face value of the underlying that outstanding contracts cover rather than the premium paid for them, so the figure describes the size of the exposure being hedged. Both strikes sat below the day's spot price, which places the market's hedging demand at levels bitcoin had not traded at during the decline.
Solana: 94% of an $88.45 Million Liquidation Was Long
Solana's fall was the sharpest among the major assets, down about 9% on the day and about 17% on the week to roughly $68.53, a price last seen in December 2023. The composition of its liquidations was the more informative figure: of $88.45 million wiped out across 12,084 traders, 94% were long positions. A split that lopsided indicates leverage that had been almost entirely one-directional going into the move. It also means there was little short interest to buy back into the decline, since covering shorts are one of the few sources of demand that reliably appear in a fast drop.
What the Positioning Implied
Taken together, the numbers describe a market that entered the week long and levered and left it flatter and poorer. The leverage that amplified the last two days has been partly cleared, which reduces the fuel available for another cascade at the same prices, but it also removes the mechanical bid that closing shorts supply on the way down. The hedging that remains is concentrated at $60,000 and $55,000, strikes that sit below the intraday low near $61,300 rather than above it. What is unresolved is whether spot demand returns to meet it. Through Wednesday, the ETF complex had been a net seller for 13 straight sessions, and the $4.37 billion redeemed since mid-May came out into the decline rather than against it.