Hong Kong Trading Session Sparks Forced Exits Across Crypto Markets
Bitcoin fell below $62,000 in Hong Kong trading Thursday morning, triggering more than $1.5 billion in leveraged crypto liquidations over 24 hours, according to data from CoinGlass and SoSoValue. The selloff forced 208,000 traders out of their positions across crypto markets.
Bitcoin liquidations alone accounted for $800 million of the total, while ether liquidations reached $386 million. The decline marks the latest chapter in a brutal week for the asset class, with bitcoin down 14% this week and 21% over the past four weeks. Bitcoin hit approximately $63,000, its lowest level since February.
The immediate trigger for Thursday’s move remains the subject of market analysis. Presto Research attributes bitcoin weakness to competition from gold and artificial-intelligence stocks as investors reassess Federal Reserve rate-cut expectations. Bitcoin’s major drawdowns this year have coincided with rallies in gold and AI stocks, the research firm noted.
The liquidation cascade occurred amid a broader exodus from bitcoin investment vehicles. U.S. spot bitcoin ETFs experienced $1 billion in net outflows this week, part of what market observers describe as a record streak of outflows from these funds.
Volatility metrics signal heightened market stress. The 30-day implied volatility reached its highest level since early April, suggesting traders are pricing in elevated uncertainty about bitcoin’s near-term direction.
Path to Recovery Hinges on Macro Shifts
Recovery may depend on easing inflation concerns and a renewed shift toward liquidity-sensitive assets rather than crypto-specific catalysts, according to Presto Research. The research firm’s analysis suggests bitcoin’s recent weakness reflects a broader rotation away from risk assets and toward traditional hedges like gold, driven by uncertainty over the Federal Reserve’s rate-cut timeline.
The $1.5 billion in liquidations underscores the leverage embedded in crypto markets. When bitcoin moves sharply, traders using borrowed capital face automatic position closures at predetermined price levels, amplifying downward moves and forcing cascading sales.
CoinGlass and SoSoValue data capture liquidations across major crypto derivatives exchanges, though the exact composition of liquidated positions across spot and futures markets remains opaque.
