Bitcoin and Ethereum Lead $1.8B Crypto Sell-Off – Reset or Crash?
The crypto market witnessed one of its largestsell-off events of the year, with liquidations totaling over $1.8 billion in just 24 hours. This sudden wipeout has left traders questioning whether the market is undergoing its final shakeout before a recovery—or if more downside lies ahead.
Widespread Liquidations Hit Overleveraged Traders
More than 370,000 traders were liquidated within a single day, according to CoinGlass data. Bitcoin (BTC) and Ethereum (ETH) bore the brunt of the losses, but altcoins also faced steep liquidations. This makes it one of the most significant corrections of 2025 so far.
The sell-off also erased $150 billion in total market capitalization, dragging the crypto market cap down to $3.95 trillion, its lowest point in two weeks. Bitcoin dropped below $112,000, while Ethereum slid under $4,150, marking their sharpest declines since mid-August.
What Triggered the Sell-Off: Technical or Fundamental?
Analysts suggest that the crash was primarily driven by technical factors rather than a shift in fundamentals. Raoul Pal, founder of Real Vision, explained that crypto markets often see traders over-leverage ahead of expected breakouts. When those breakouts fail, liquidation cascades follow—only for the market to stabilize afterward.
CoinGlass confirmed that this was the largest long liquidation event of 2025, similar to other wipeouts seen in February, April, and August. In each case, spot markets shed hundreds of billions within hours.
Altcoin Leverage: The Hidden Risk Factor
A significant driver of this liquidation wave was the excessive leverage in altcoins. Researcher Bull Theory highlighted that Ethereum liquidations surpassed $500 million, more than double Bitcoin’s figure, due to the high imbalance of leveraged positions in altcoins.
“When altcoin leverage becomes too extreme, it often sparks a chain reaction of liquidations,” Bull Theory noted. “This resets the market by flushing out weaker positions.”
Bitcoin Outlook: Correction or Bullish Continuation?
Despite the sharp pullback, many experts view this as a healthy correction within a broader bull run. Nassar Achkar, Chief Strategy Officer at CoinW, argued that easing monetary policy and strong demand for risk-on assets like Bitcoin continue to support long-term bullish momentum.
Analyst Tony Sycamore of IG Markets added that Bitcoin could dip further, possibly testing the $105,000–$100,000 range, with the 200-day moving average near $103,700. Such a correction, he suggests, would help the market clear out weaker hands and prepare for a stronger rally later this year.
Historical Perspective: Bitcoin’s Resilience
Bitcoin’s recent 9.5% pullback from its all-time high is relatively modest compared to past bull market corrections. Historically, September has been a weak month for Bitcoin, while October—often called “Uptober”—tends to bring stronger performance.
Despite volatility, Bitcoin still managed to post a 4% gain in September, showing that momentum remains intact heading into the final quarter of 2025.
Conclusion: Market Reset or Buying Opportunity?
The $1.8 billion liquidation event has rattled investors, but many see it as a short-term reset rather than the end of the bull cycle. While further volatility is expected, the long-term outlook for Bitcoin and major cryptocurrencies remains strongly bullish, with technical corrections potentially setting up the next major rally.
