Crypto Selloff Today: $470 Million Liquidated as Bitcoin, Ethereum and Solana Plunge
Cryptocurrency markets started the week in the red, with more than $470 million liquidated in just 24 hours. Major coins such as Bitcoin, Ethereum and Solana fell sharply as investors became cautious ahead of important US economic data and growing recession fears.
Bitcoin and Ethereum lead the decline
Bitcoin fell 2.43% to $107,785, extending its three-week battle to overcome the key $113,000 resistance level. Ethereum also fell 4.25% to $3,732 as excitement around ETH ETFs cooled. The pain spread across the altcoin market, with Solana (SOL) down 6.5% to $174, BNB down 5.7% to $1,029, and XRP down 5% to $2.38.
This massive drop wiped out more than $100 billion from the total cryptocurrency market capitalization, marking a 3.2% drop on the day.
What caused the sell-off?
Traders were spooked after U.S. Treasury Secretary Scott Bessent warned that the Federal Reserve 's high interest rates could have pushed some parts of the economy, particularly the housing market, into recession. His comments raised concerns that tighter monetary conditions could weaken demand for riskier assets like cryptocurrencies.
Additionally, the MEXC exchange controversy has stoked fears among traders. Some users have accused the platform of freezing withdrawals, sparking rumors of bankruptcy. Although MEXC later released a proof of reserves (PoR) report confirming sufficient collateral, the scare has reignited concerns about trust in centralized exchanges.
The downturn also comes ahead of Friday’s US jobs report, which could significantly impact expectations for a Fed rate cut and, therefore, crypto sentiment.
Bitcoin ETFs Face Huge Capital Outflows
Investor caution is also evident in traditional markets. According to Fairside, US spot Bitcoin ETFs saw a massive $1.15 billion in outflows last week. The largest withdrawals came from BlackRock, ARK Invest and Fidelity, suggesting that even institutional investors are reducing their exposure to Bitcoin-related products amid market turmoil.
Mass Liquidation and What's Next
Data from CoinGlass shows that nearly $470 million in crypto was liquidated in a single day, led by Ethereum ($112 million), followed by Bitcoin and Solana. Centralized exchanges like Binance and Bybit accounted for the majority of the losses, while decentralized platform Hyperliquid saw $100 million in liquidations, reflecting the growing shift of traders to DeFi platforms.
In response to the crisis, crypto analyst Lark Davis said the crypto market is facing a constant sell-off and fear, causing many traders to lose hope. However, he believes that the overall economic picture still supports future growth. As the US government reopens and money starts flowing back into the system, the market could recover, but before that, the difficulties will continue.
With more important economic speeches and a Federal Open Market Committee (FOMC) meeting scheduled for next week, analysts warn of continued volatility. For now, traders are minimizing risk, watching from the sidelines and preparing for the next move in this ongoing crypto storm.