I just saw a massive liquidation happening in the crypto market that was quite shocking. Long leverage positions on Bitcoin were wiped out completely, especially as the price dropped from around $68,600 down to $64,300 over a few days. Crypto liquidation is the process in which traders’ positions are forced to close by an exchange when their collateral isn’t enough, and what happened last week was truly brutal.

A single liquidation worth $61,5 million on one of the major exchanges recorded a new record for the largest liquidation in 24 hours. The total overall reached $467 juta from tens of thousands of traders, with long positions accounting for 93% of that amount. This means that most traders are still bullish, but it turns out they weren’t ready for this downward volatility.

What’s most striking is that the Fear and Greed Index dropped to 5 from 100, in the “extreme fear” category, which rarely happens. This is only the third time since the index was launched. Data shows that the realized net losses of short-term bitcoin holders still reach about $500 juta per day, meaning many are still capitulating.

Now, bitcoin is 48% below its all-time high of $126,000 and continues to be tested at support levels. The pattern repeats: traders add leverage on every small bounce, keep getting liquidated, reset, and this cycle is likely to continue. This is a hard lesson that crypto liquidation is a real risk when using leverage in a market under pressure.