The cryptocurrency market is facing significant losses today as Bitcoin (BTC) suffered a sharp price drop of nearly 7%, falling to $97,905. This dramatic decline caused a ripple effect across the market, leading to massive liquidations. Bitcoin’s crash resulted in nearly $900 million worth of leveraged positions being wiped out across the crypto space.
Mass liquidations in the market
According to data from Coinglass, over 316,000 traders were liquidated during this price drop, contributing to a total of $881 million in liquidated positions. Long positions were hit the hardest, making up about $820 million of the total, while short liquidations accounted for $60 million.
The largest single liquidation occurred on the HTX exchange, with a massive $98.46 million position being liquidated.
Market sentiment shifts to neutral
As the market continues to struggle, the Crypto Fear and Greed Index shows a shift in sentiment. The index now stands at 55, indicating a “Neutral” outlook. With caution growing in the market, more traders are betting against Bitcoin’s recovery by taking short positions.
Bitcoin Critical Support Level: $98,000
Bitcoin is currently testing its crucial support at $98,000, which needs to be held to prevent further declines. If Bitcoin loses this level, it could trigger a deeper correction, erasing recent gains and causing more uncertainty in the market.
Pressure on Bitcoin is intensifying as the Federal Open Market Committee (FOMC) meeting approaches on January 29, further increasing tension.
Interestingly, former BitMEX CEO Arthur Hayes predicted a “mini financial crisis,” suggesting that Bitcoin could drop to $70,000 before embarking on a strong bull run towards $250,000.
Reversing the order of my triptych essay series. The Ugly will be published tomorrow morning. I'm calling for a correction from $70k to $75k in $BTC, a mini financial crisis, and a resumption of money printing that will send us to $250k by the end of the year. pic.twitter.com/XxT4VFyzu4
— Arthur Hayes (@CryptoHayes) January 27, 2025
Altcoins are also hit hard
It wasn’t just Bitcoin that suffered, altcoins also faced significant losses. Ether (ETH) was the worst hit, with over $110 million worth of long positions liquidated.
Other major cryptocurrencies, including Solana (SOL), XRP, Dogecoin (DOGE) and Chainlink (LINK), saw their values drop by double digits, adding to the overall market turmoil.
