Market Pulse: Crypto Faces $508M Long Liquidation Wave Amid Macro Headwinds and Fed Policy Shifts

The Liquidation Story Behind Market Turbulence

Cryptocurrency markets endured significant liquidation pressure over the past 24 hours, with cumulative losses reaching $594 million across all positions. Long liquidations accounted for $508 million of this total, reflecting intense bearish positioning. Bitcoin experienced $179 million in liquidations while Ethereum saw $193 million cleared—indicating broad-based selling across major assets.

The liquidation heatmap reveals a critical technical picture: BTC traded near $90.68K with extensive long liquidations previously cleared below the 85K support level. Notably, short liquidation leverage is rapidly accumulating in the 87K–92K range, signaling potential squeeze opportunities. A decisive break above 87K could trigger cascading short liquidations accelerating upside momentum; conversely, a retreat below 85K would signal weakening near-term conviction.

Institutional Accumulation Continues Despite Market Weakness

Contrasting the liquidation carnage, major institutions demonstrated remarkable conviction. Strategy deployed $980.3 million last week to acquire 10,645 BTC, showcasing aggressive accumulation at current levels. Simultaneously, Bitmine increased its Ethereum holdings by 102,259 ETH (valued at $321 million), despite showing an unrealized loss of $3.019 billion on its total position. These entities now command staggering assets: Bitmine controls over 3.2% of ETH’s total supply with $13.3 billion in total holdings, while Strategy maintains an unrealized gain of $9.618 billion on its Bitcoin position.

This institutional behavior reveals a critical market dynamic—professional players are accumulating at precisely the moment retail liquidation pressure peaks, suggesting confidence in medium-term recovery prospects.

Macro Environment: Fed Rate Cuts and Leadership Uncertainty

Federal Reserve President John Williams reinforced the central bank’s recent rate-cutting decision, citing cooling labor market conditions and declining inflation risks as justification. However, uncertainty clouds the Fed’s leadership trajectory. According to sources from Jin10, Kevin Hassett—once considered an almost inevitable candidate for Fed chair—now faces significant opposition from several senior Trump administration figures.

This political friction over Fed leadership introduces additional uncertainty into monetary policy expectations, potentially influencing capital flows into risk assets including cryptocurrency.

Regulatory Clarity and Political Shifts

The U.S. Senate postponed consideration of the crypto market structure bill until 2025, deferring long-awaited regulatory clarity. Meanwhile, reporting from the New York Times revealed that the SEC has dismissed 60% of cryptocurrency cases inherited from the Biden administration—most involving business relationships with the Trump family. This substantial reduction in regulatory enforcement represents a notable shift in crypto sector treatment.

Spot Market Dynamics

Bitcoin’s spot market reflected mixed investor sentiment: inflows totaled approximately $127 million over 24 hours, while outflows reached $149 million, resulting in a net outflow of $22 million. This modest exit suggests consolidation rather than capitulation, as institutional positions remain structurally bullish.

Technology and Project Innovation Accelerates

Network Expansion: MetaMask launched native Bitcoin support, advancing its multi-chain strategy. Ripple’s stablecoin RLUSD expanded to Layer 2 networks using Wormhole’s NTT standard, enhancing interoperability. Circle acquired Interop Labs’ team and IP while keeping Axelar independently operated, signaling ongoing consolidation in infrastructure.

Futures and Asset Markets: CME introduced spot-priced XRP and SOL futures, while Charles Schwab added Solana and Micro Solana futures products. Nasdaq plans to file for 24/7 stock trading services approval this week—a development that could reshape market microstructure.

Protocol Developments: Bittensor completed its first halving, reducing TAO daily issuance to 3,600 tokens. The Avalanche Foundation established a distributed ledger technology entity in Abu Dhabi, signaling Middle East expansion. Japan’s Startale and SBI are launching a regulated yen-denominated stablecoin, expanding on-ramp accessibility in Asia.

Forward-Looking Insights

Grayscale research indicates quantum computing poses negligible cryptocurrency price risk through 2026. Conversely, prediction markets show explosive growth potential, with revenue projected to exceed $10 billion by 2030—a fivefold expansion. Ondo Finance plans to launch tokenized stocks and ETF platforms on Solana in early 2026, bridging traditional and crypto finance.

Market Indicators Note: Bitcoin network activity has declined to 12-month lows with active addresses averaging 660,000 on a 7-day basis. While seasonal slowdowns are normal, multiple network metrics warrant monitoring for deeper weakness signals.

The confluence of institutional accumulation, regulatory tailwinds, leadership uncertainty, and technical squeeze potential creates a pivotal market inflection point.