[NEWS] Over $8 billion in positions were liquidated during the sharp decline on the 3rd

On the 3rd, a sharp price drop occurred, leading to large-scale position liquidations, according to data from Coinglass. The sudden decline impacted over 700,000 participants, with long positions accounting for $1.8 billion, making up 80% of the total liquidation amount.

This liquidation surpassed the scale of those triggered by COVID-19 and the collapse of FTX, significantly affecting market participants who relied on leverage.

Meanwhile, in response to the reports, Bybit CEO Ben Zhou stated that while Bybit alone recorded $2.1 billion in liquidations over 24 hours, Coinglass data only reflected $333 million due to data feed limitations. He pointed out that some platforms might only be reporting a fraction of the actual losses.

He further speculated that the actual liquidation amount could exceed $8 billion. To enhance transparency, Bybit has pledged to disclose all liquidation data.

I am afraid that today real total liquidation is a lot more than $2B, by my estimation it should be at least around $8-10b. FYI, Bybit 24hr liquidation alone was $2.1B, As you can see in below screenshot, Bybit 24hr liquidations recorded on Coinglass was around $333m, however,… https://t.co/4WLkPxTYF4 pic.twitter.com/woTOHQvNkt

— Ben Zhou (@benbybit) February 3, 2025

The tariff policy initially set to take effect on February 4 under President Donald Trump has significantly impacted financial markets. The policy aimed to impose a 25% tariff on imports from Canada and Mexico and a 10% tariff on imports from China.

President Trump justified the tariffs as a measure to strengthen U.S. national security and protect the domestic economy. However, the markets reacted negatively, reflecting concerns over trade tensions.

• The Dow Jones Industrial Average temporarily dropped by more than 600 points.
• The S&P 500 fell nearly 2%, while the Nasdaq Composite Index declined 1.2%, signaling a broad downturn across major financial indices.

The cryptocurrency market also experienced a risk-off movement, with Bitcoin plunging to approximately $91,000, marking a three-week low. As a risk asset, cryptocurrencies tend to experience capital outflows during periods of heightened trade war concerns. The sharp decline can be attributed primarily to investors increasing their risk-averse stance.

Following these market movements, President Trump announced a one-month delay in implementing the tariffs. The decision came after negotiations with Canada and Mexico, where both countries pledged to strengthen border security measures.

While the delay provided a temporary relief in some markets, investors remain cautious, and overall market volatility persists.

Reference : Ben Zhou X

Image: Shutterstock

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