#BTC Bitcoin plunges 10% after hitting all-time highs, triggering $1 billion crypto liquidation

💎 Bitcoin (BTC) is down more than 10% from its all-time high on Tuesday, and massive sell-offs on crypto exchanges limited the price from rising above $69,000 and dropping below $60,000 at one point.

Earlier in the day, BTC rose to $69,200, but crypto exchange Bina//nce's order book showed numerous sell orders clustered at higher price levels, where more than 300 BTC (worth around $20 million) would sell for $69,000 and more than 500 BTC would sell for $70,000.

The selling pressure created a significant obstacle for Bitcoin's price and caused the cryptocurrency to plummet. After the CoinDesk Bitcoin Index (XBX) briefly hit an all-time high of $69,208 at 15:04 UTC, BTC fell by more than $1,000 in a minute.

💎Data from the CoinDesk Bitcoin Index showed that the sell-off accelerated in waves, with the price falling first below $65,000 and then to $59,700. At press time, BTC price has risen to $62,800.

The pullback caused BTC to fall 7% in the last 24 hours, underperforming the 3% drop in the broader market CoinDesk 20 Index (CD20), which outperformed due to the relatively strong performance of Ethereum ETH and Solana SOL. Cardano's ADA, Dogecoin, and other major altcoins such as Shiba Inu SHIB are down about 10-12%.

💎 Cryptocurrency liquidations on the rise

CoinGlass data shows that the frenetic price action triggered severe leverage losses, liquidating derivatives trading positions worth more than $1.1 billion across all digital assets in the past 24 hours. According to CoinGlass, about $870 million of the liquidated positions were long positions or bets on asset prices rising.

When a trader does not have enough funds to cover the loss of a position, liquidation occurs due to partial or total loss of the trader's initial capital or "margin", the exchange closes the leveraged trading position. When asset prices fall, this dynamic can trigger a series of liquidations, exacerbating losses and price declines. A major liquidation event usually marks a local peak or bottom in an asset's price.

💎 Tuesday's move even surpassed the $1 billion leverage sprint last August, when Bitcoin suddenly dropped from $28,000 to below $25,000. Although this move was only a few weeks before Bitcoin started to rise again, it roughly marked a local low for the price.

Will Clemente, co-founder of Reflexivity Research, noted that Tuesday's events reminded him of Bitcoin's Thanksgiving movements in 2020. At the time, the bulls were expecting an imminent break above the $20,000 level, but Bitcoin reached $19,500 and then fell and bottomed out. It reached nearly $16,000 in a very short period of time.

In the X post, Clement said: "Any decline is to break free from the shackles of the leveraged monkey and buy right now.