A renewed wave of selling pressure hammered cryptocurrency markets on Monday, triggering the forced closure of leveraged positions worth nearly US$1 billion and extending a broad downturn now entering its third month.
Major Tokens Slide as Selloff Accelerates
The liquidation cascade coincided with steep declines for major digital assets. Bitcoin slid as much as eight per cent to US$83,824, pushing its year-to-date loss beyond nine per cent. Ether, the second-largest token, dropped 10 per cent to a low of US$2,719, marking an 18 per cent decline since December of last year.
The pain was even more acute for smaller, less liquid tokens, which often attract traders due to higher volatility. An index tracking the bottom half of the top 100 digital assets has plunged almost 70 per cent this year.
Structural Headwinds and Macro Pressures Mount
Analysts point to fundamental concerns within crypto markets, compounded by shifting global macroeconomic conditions. "The biggest concern is the meagre inflows into Bitcoin exchange traded funds and absence of dip buyers," said Sean McNulty, APAC derivatives trading lead at FalconX. He noted the market is watching the US$80,000 level on Bitcoin as a critical next support.
Digital assets were not immune to broader market tremors. U.S. equity traders started the week cautiously, while Japanese stocks fell and the yen strengthened after the Bank of Japan's governor hinted at a potential rate hike. "As December kicks off, investors are focused on the path forward for global monetary policy," commented Karim Dandashy, an OTC trader at Flowdesk.
Liquidation Data and Corporate Moves Under Scrutiny
Monday's event is part of a longer corrective phase. Data from tracker Coinglass shows the selloff began in early October when roughly US$19 billion in levered bets were liquidated, just days after Bitcoin set its all-time high of US$126,251. Such automated liquidations are often called a "liquidation cascade."
While traders use this data to gauge market leverage and risk, industry insiders warn figures may be incomplete, as exchanges sometimes restrict full data disclosure.
In a related corporate development, Michael Saylor's MicroStrategy Inc. announced it had established a US$1.4 billion reserve to fund future obligations, aiming to calm fears it might be forced to sell part of its massive Bitcoin holdings if prices keep falling. The company's shares tumbled more than 10 per cent on Monday.
The crypto market remains on shaky ground, with traders assessing whether the latest wipeout has sufficiently purged speculative excess or if further declines are ahead.
