Bitcoin rebounds after dreadful day that saw $1.26 billion in liquidations

As bitcoin continues to set new cycle lows, altcoins are revisiting levels not seen in several years. Over the past 24 hours:

• XRP has dropped nearly 19% to trade at $1.24, its lowest mark since November 2024;

• Solana is down 7% to trade under $84, returning to a price point last recorded in January 2024;

• Dogecoin has slid 10% to $0.09, a price last seen in September 2024;

• chainlink is down below $8.40, erasing all gains made since October 2023. 

It’s hitting the crypto ecosystem hard: 305,791 traders have been liquidated in the past 24 hours, with total liquidations standing at $1.46 billion, CoinGlass data shows. The market capitalization of the entire crypto space is now at $2.35 trillion, a drawdown of 7.5% in the last 24 hours and a stunning 46.6% plunge from the all-time high of $4.4 trillion set in October 2025. 

The altcoin market is correlated with bitcoin, with both undergoing a steep decline, according to Devin Ryan, director of financial technology research at investment bank Citizens Capital Markets & Advisory. 

As to what is driving the downswing, Ryan pointed to the October sell-off that triggered the massive initial wave of liquidations as well as a number of macro headwinds, such as ongoing geopolitical conflicts, concerns of another government shutdown, and uncertainty surrounding a new Fed chair.

There’s volatility in the asset class because of market structure issues and concerns around where bitcoin goes from here from a price perspective, Ryan said.

Ryan expects the correlation between bitcoin and the rest of the crypto ecosystem to break down over the next year to two years.

The recent volatility highlights that cryptocurrency’s blockchain technology is still in an early phase, Ryan said. “We are still in the early days of even getting the clarity around regulation and the legislation that’s needed to progress from this world of pilot phase — what might happen on the blockchain to here’s what’s happening on the blockchain and on which blockchains,” Ryan told Sherwood News. 

Ethereum, the second-largest cryptocurrency, has shed over $100 billion of its market capitalization in the last seven days as the price falls under the $2,200 level, a nearly nine-month low, data from CoinGecko shows. 

Marking a bottom on any market action is difficult, but the price of ethereum still remains weak with more downside risks. Jim Hwang, COO of crypto investment firm Firinne Capital, told Sherwood News, “Looking back to the volatility back in April 2025, we see that there may be support around $1,500.” 

Meanwhile, spot ethereum ETFs have recorded $342 million in outflows so far this year. The token’s price action and ETF outflows are in “stark contradiction” to the network’s fundamentals, namely the increase in the amount of real-world assets tokenized and usage metrics, Hwang argued.

Ethereum’s price slump comes as cofounder Vitalik Buterin said on Tuesday that the “original vision of L2s and their role in Ethereum no longer makes sense,” pointing to how the progress of layer 2 networks has been slower and more difficult than initially expected, while the “L1 is itself scaling” and reducing fees.