Bitcoin News Update: Crypto Leverage Unravels—$217 Million Disappears Within a Day

The crypto market just went through one of its most intense 24-hour liquidation periods in recent times, as more than $217 million in leveraged trades were wiped out when

and both dropped sharply, triggering a chain reaction of forced selling. This wave of liquidations, fueled by excessive leverage and automated margin calls, highlighted the instability of margin trading in the crypto space and left many traders stunned. According to an , long trades made up $167 million of the losses, while shorts accounted for $50 million, illustrating the sector’s notorious volatility.

Bitcoin and Ethereum, the leading digital assets, were at the forefront of the downturn. Bitcoin’s value fell below a crucial support, resulting in $21.5 million in long liquidations and $11.6 million in short liquidations. Ethereum saw even greater losses, with $36.7 million in longs and $28.7 million in shorts liquidated as its price tumbled. Lesser-known coins such as

and also faced volatility, though their liquidation figures were much smaller compared to Bitcoin and Ethereum, the report noted. Experts caution that this episode underscores the dangers of high leverage, as even minor price changes of 2–3% can set off a cascade of losses.

This market upheaval coincided with a steep drop in Strategy Inc. (MSTR), the company holding the largest corporate stash of Bitcoin. Despite posting its best-ever Q2 2025 results—$32.60 per share, a company record—MSTR’s stock slid 4.16% after the earnings release, closing at $270.07. The decline reflected investor concerns over the firm’s heavy exposure to Bitcoin, which now makes up 3% of the total supply in circulation. MSTR’s market value has fallen from $45 billion to $27 billion, mirroring Bitcoin’s price drop and a decline in retail investor interest, according to an

.

Although MSTR’s Q3 numbers remained strong, they failed to restore investor confidence. The company reported $8.42 in earnings per share, mainly due to gains from its Bitcoin holdings, but its stock has dropped 14% so far this year. In October alone, shares fell 20% as Bitcoin slipped below $107,000, pushing MSTR’s market net asset value (mNAV) just above 1 and effectively halting new common stock offerings, as highlighted in a

.

There is no consensus among analysts about what comes next. Some, like Markus Thielen of 10X Research, believe that with MSTR’s valuation now closely matching its Bitcoin reserves, a rebound could be on the horizon. He suggests that if the company is added to the S&P 500, it could attract $28 billion in institutional investment. Others warn that MSTR’s fate is closely tied to Bitcoin’s price movements. CEO Michael Saylor remains optimistic, predicting

will hit $150,000 and that the company could earn $24 billion in 2025, according to .

The overall crypto sector continues to be unsettled. Bitcoin has stabilized around $114,470, while Ethereum is holding above $4,100. Market capitalization data shows Bitcoin’s dominance at 47.8%, with Ethereum at 19.3%. Despite the recent swings, CoinMetrics analysts report that long-term investors are accumulating Bitcoin, suggesting the early stages of a new growth phase ahead of the 2026 halving event.

At present, the industry is walking a tightrope. Large-scale liquidations can help reduce speculative leverage and potentially set the stage for a steadier rally, but broader economic factors—such as U.S. inflation numbers and Federal Reserve decisions—remain major concerns. As one trader remarked, "Volatility is the cost of opportunity," but careful risk management is crucial in a market where fortunes can change overnight, the report added.

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