Crypto Market Sees $450 Million in Liquidations Amid Geopolitical Tensions and Bearish Bitcoin Movement

Nearly half a billion dollars in bullish crypto bets got liquidated as the market faced geopolitical pressures. According to data from CoinGlass, 86% of traders were feeling optimistic as they entered October.

In just the past 24 hours, futures tied to major cryptocurrencies saw over $450 million in long liquidations. This happened primarily because bitcoin (BTC) took a dive, leading to losses across major tokens. Some even dropped by as much as 8%!

CoinGlass reports that traders betting on rising bitcoin prices lost over $122 million. Meanwhile, bets on ether (ETH) saw losses nearing $100 million. Smaller alternative tokens, also known as altcoins, experienced liquidations exceeding $85 million, marking the highest figures since July. Interestingly, the memecoin pepe (PEPE) alone accounted for about $10 million in liquidations.

Now, what exactly is a liquidation? It occurs when an exchange has to close a trader's leveraged position because they can't meet the margin requirements. Large-scale liquidations often signal market extremes, like panic selling or buying. If a cascade of liquidations happens, it might indicate a turning point in the market. A price reversal could be on the horizon due to an overreaction in market sentiment.

On Tuesday, global equities and risk assets, including bitcoin, took a hit. This was after Iran launched missile strikes on key Israeli locations. Israel responded with threats of retaliation in the coming days. BTC fell to as low as $60,300, marking a rough start to a historically bullish month. However, it managed to recover above $61,500 during Asian trading hours on Wednesday. This drop caused significant pain for futures traders, who faced their biggest losses since early August.

The data shows that nearly 86% of all futures bets were bullish. Traders were positioning themselves for higher prices in the weeks ahead. October has traditionally favored BTC, with only two negative months recorded since 2013. Recent market conditions, including global monetary policies and U.S. political support, suggested a continued bullish trend. Some traders are even targeting $70,000 for BTC in the coming weeks.