$135 Million Wiped Out in Crypto Liquidations as BTC and ETH Lead Selloff

A sudden wave of volatility in early August 2025 wiped out over $135 million in crypto liquidations within just 24 hours. Leading this selloff were Bitcoin (BTC) and Ethereum (ETH), with Ethereum seeing nearly $41 million in liquidations and Bitcoin close behind at $30 million.

The market turbulence, triggered by a mix of macroeconomic events and investor uncertainty, primarily impacted short sellers. Over $106 million in shorts were liquidated—underscoring the risks of high leverage during unpredictable market swings.

Bitcoin and Ethereum Liquidations Highlight Trading Risks

Bitcoin and Ethereum continue to anchor the crypto market, but their volatility can amplify losses for leveraged traders. The $135 million in total liquidations was largely driven by aggressive short positions, as BTC and ETH briefly surged before reversing.

Market data from this period reveals:

• $41M liquidated in ETH, leading all assets
• $30M in BTC liquidations, a close second
• Shorts accounted for $106M, indicating surprise upward moves
• Longs lost $29M, mostly in later price reversals

These figures highlight how sudden shifts—even minor ones—can create cascading liquidations in a highly leveraged market.

Liquidations Topped $700M–$900M Later in 2025

While $135 million is significant, it’s modest compared to other liquidation events seen in 2025. Throughout the year, crypto markets have experienced even more extreme volatility:

• $724 million was wiped out during a late July selloff, shrinking crypto’s total market cap to $3.33 trillion
• $965 million in 24-hour liquidations occurred during a volatility spike in Q2, with long traders hit hardest
• On August 1, 2025, Bitcoin’s price drop below $113,000 triggered over $700 million in losses, primarily from long positions on BTC and ETH

These numbers suggest the $135 million liquidation was part of a broader trend of recurring, high-volume liquidations.

Why Leveraged Crypto Trading Remains Risky

The crypto derivatives market thrives on leverage, but high exposure cuts both ways. In times of macroeconomic uncertainty—such as U.S. tariff changes or disappointing economic indicators—volatility surges and triggers automatic position closures.

Key risk factors for liquidations:

• Overleveraged long or short positions
• High volatility across BTC and ETH
• Unpredictable macroeconomic developments
• Automated liquidations from trading platforms

Traders often underestimate how fast liquidations can snowball in tightly correlated crypto markets.

Read more: Bitcoin Price Prediction: Will BTC Surge Toward $145K After Whales Buy the Dip at $113K?

Market Outlook: More Volatility Ahead?

Crypto’s 2025 trajectory shows no signs of cooling down. With institutional capital increasing and macroeconomic variables in flux, the likelihood of sudden selloffs remains high. While this $135 million liquidation was impactful, it’s dwarfed by other major events that demonstrate how quickly capital can evaporate.

For both retail and professional investors, the lesson is clear: leverage must be managed with extreme caution, especially in crypto.

Final Thoughts

The $135 million in liquidations led by BTC and ETH reflects more than just a bad trading day—it’s a symptom of broader structural volatility in the crypto market. While relatively smaller compared to later events in 2025, this selloff underscores the dangers of leveraged trading during uncertain conditions.

As crypto adoption grows and derivatives become more sophisticated, risk management—not just profit chasing—will be critical for survival in the ever-volatile digital asset space.

Read Also: How ETFs Are Quietly Changing Bitcoin’s Market

FAQs

What are crypto liquidations?

Crypto liquidations occur when a trader’s leveraged position is forcefully closed by an exchange due to insufficient margin to cover losses, usually during sudden price movements.

Why were short positions hit harder in the $135M liquidation?

Short sellers were betting on declining prices. A surprise price rebound in BTC and ETH forced automatic liquidations, resulting in over $106 million in short losses.

How often do large-scale liquidations happen in crypto?

In 2025, liquidations over $700 million in 24 hours have occurred multiple times, especially during sharp price movements or economic announcements.

What causes crypto volatility to spike?

Key drivers include macroeconomic news (like tariffs or inflation data), regulatory developments, whale movements, and leveraged trading dynamics.

How can traders protect themselves from liquidations?

Use lower leverage, set stop-losses, diversify positions, and monitor macroeconomic signals that may trigger sudden market shifts.