The cryptocurrency market has indeed been turbulent in the past 24 hours. Bitcoin sharply dropped below $90,000, touching a low of around $86,000. Ethereum also fell below $2900, sliding down to $2827. According to on-chain data, the scale of liquidations during this adjustment was quite astonishing—21.88 million traders were liquidated, with total liquidation amount exceeding $537 million, of which over 85% were long positions.

It seems like a one-sided slaughter, but a closer analysis reveals another story.

**The Cost of Leverage Games**

This decline appears sudden but is actually predictable. Since Bitcoin hit a record high of $126,000 in early October, it has retraced nearly 30% in just a month and a half, wiping out all gains made this year. The cooling of expectations for Federal Reserve rate cuts is an important background—risk assets are under pressure—but this is only the surface reason.

What truly fueled the decline was the accumulation of high-leverage positions within the market. According to exchange liquidation data, the forced liquidation of long positions during this wave reached $1.828 billion, while short liquidations were only $137 million. The stark contrast clearly indicates that leverage distribution in the market is severely uneven, and once prices come under pressure, it can easily trigger a domino effect of chain liquidations.

**Clearing ≠ Leaving**

A careful comparison with historical data reveals interesting patterns. In mid-October 2025, a similar liquidation storm occurred, with nearly $19.3 billion in liquidations within 24 hours, forcing the liquidation of approximately 1.67 million traders. Although that crash was fierce, the market responded quickly afterward, with Bitcoin rapidly rebounding.

This suggests a key point: large adjustments are often not signals of a top but rather a process of market clearing high-risk positions and preparing for the next upward move. When many over-leveraged positions are forcibly liquidated, the market structure can actually become healthier.