The crypto market is having a rough week, with nearly all of the top 100 cryptocurrencies barring stablecoins registering losses. Of the top 10 cryptocurrencies by market cap, Ripple’s XRP, Dogecoin (DOGE), and Cardano (ADA) have taken the biggest hits, while Ethereum (ETH) and Solana (SOL) have also dropped by 8% in the past 24 hours, according to data from CoinGecko . Over the past day, XRP fell 19.3% to $1.94 while DOGE dipped by 15.6% to $0.3681. Bitcoin (BTC) wasn’t spared either, dropping 3.5% to $94,402. K33 Research noted on Dec. 10 that the total altcoin open interest relative to the altcoin market capitalization jumped from around 3.6% to $4.4% on Monday, resulting in skyrocketing funding rates. Nonetheless, the leverage buildup unraveled quickly, plummeting back to $3.9% after a cascade of liquidations sparked an across-the-board selloff. “Yesterday’s altcoin leverage wipeout was potentially the largest daily long liquidation event since May 19, 2021, and liquidations saw altcoin leverage fall by $12.8 billion, the largest daily reduction in altcoin open interest ever,” K33 Research’s Head of Research Vetle Lunde wrote. “We note that cascading liquidations were a frequent feature of the 2021 bull market and are seemingly back on the menu as we near the end of 2024.” Liquidation data from Coinglass shows over $1.69 billion in total liquidations amid the crypto market-wide pullback. Long positions make up the majority of that tally at $1.39 million in wiped-out derivative positions. Altcoins felt the most pain as the overall crypto market cap shrunk by 8.3%. Where To From Here? Crypto trader Ash Crypto has suggested that the liquidation has wiped out “weak hands” and allowed smart money to buy coins at a nice discount. The trader told his 1.4m followers on X that he expects Bitcoin is set to “snap back quickly.” THE BIGGEST LIQUIDATION SINCE 2021! WHY DOES THE MARKET DUMP AND WIPE ALMOST $2 BILLION TRADES IN JUST 24 HOURS? HERE'S WHAT HAPPENED: 1. COINBASE TRADERS STARTED THE SELL-OFF. COINBASE TRADERS BEGAN SELLING 1 HOUR BEFORE THE MAJOR DUMP. THE SELL PRESSURE PUSHED THE… pic.twitter.com/upknm2uftF — Ash Crypto (@Ashcryptoreal) December 10, 2024 Notably, bullish tailwinds that helped propel Bitcoin higher over the past few weeks are still present. For instance, MicroStrategy made a huge $2.1 billion Bitcoin buy this week, evidence of a strong institutional presence in the market. Moreover, the U.S.-listed spot BTC and ETH exchange-traded funds (ETFs) have witnessed eight straight days of net inflows , further signaling robust institutional demand.
