Crypto Market Liquidation Sees $3.96 Billion Wiped Out

Coinglass reports a massive $3.96 billion crypto market liquidation over the past 24 hours, impacting long positions predominantly in Ethereum, with Binance hosting the largest single liquidation.

The event highlights significant market vulnerability, with Ethereum and Bitcoin futures leading the liquidations, sparking concerns over leverage risks and market stability.

$3.96 Billion Crypto Liquidation Shakes Market Stability

The liquidation event resulted in long positions losing $3.38 billion, with Binance confirming the largest single liquidation involved an ETHUSDC order worth $4.45 million. The broad selloff affected major cryptocurrencies, predominantly Ethereum and Bitcoin, reflecting significant pressure on highly leveraged positions.

The fallout of this liquidation exposes how automated margin calls drive liquidity flows, further emphasizing the risk of market corrections on leveraged positions. The immediate consequence is temporary price suppression and heightened volatility for leading assets like ETH and BTC, with Bybit and Gate.io seeing substantial exposure.

“It seems that there are no direct quotes from leadership or primary sources related to the significant crypto market liquidation that occurred on August 2–3, 2025. The analysis indicates that major exchanges and their leaders (such as CZ of Binance, Ben Zhou of Bybit, and Arthur Hayes of BitMEX) have not provided public commentary regarding this particular event. The primary focus has been on data reporting from exchanges without accompanying insights or opinions from prominent figures.”

Ethereum, Bitcoin Face Volatility Amidst Liquidity Pressures

Did you know? Ethereum led in margin call-triggered liquidations during similar market disruptions in May 2021.

According to CoinMarketCap, Ethereum (ETH) stands at $3,483.30, with a market cap of $420.47 billion. Despite a 0.66% dip over 24 hours, ETH maintains a market dominance of 11.42%. The 24-hour trading volume, down 25.09%, reflects a cautionary trading stance post-liquidation.

The Coincu research team suggests that market reactions to such liquidation events drive immediate volatility, often revisiting previous price compromises. The absence of regulatory responses allows the market to self-regulate, posing opportunities disguised as challenges, according to historical trends across Layer 1 tokens, with ETH and BTC in focus. Binance exchange receives huge investment.