ETH was shocked for 10 minutes! Behind the 3.4% plunge, tens of thousands of people liquidated their positions in dominoes

Vitalik 2025-11-24 08:20 52421人围观 ETH

"It's over, it's liquidated! ”This Monday morning, the currency trading group was suddenly flooded with such news. Everyone who opened the market software panicked - the price of Ethereum (ETH) was like a kite with a broken string, plummeting from US$3,21

“It’s over, it’s liquidated! ”This Monday morning, the currency trading group was suddenly flooded with such news. Everyone who opened the market software panicked - the price of Ethereum (ETH) was like a kite with a broken string, plummeting from US$3,214 to US$3,104 in 10 minutes. The 3.4% drop was not the largest in history, but behind it was the forced liquidation of hundreds of millions of dollars in long positions. A "domino effect" caused by the liquidation of ETH made the already fragile crypto market even worse.

A leveraged player’s nightmare: “Auto-harvesting” on HyperLiquid”

The starting point of this storm is on the decentralized perpetual contract exchange HyperLiquid. This platform is famous for its "high leverage" and "cross margin" in the currency circle. Many traders rushed in with the mentality of "taking small to gain big" - some people use 100,000 yuan of principal plus 10 times leverage, which is equivalent to leveraging a 1 million position. If it rises by 10%, it can be doubled, but if it falls by 10%, it will lose everything.

The fuse was lit when Bitcoin fell below $90,000. As the "big market bellwether" of the crypto market, Bitcoin's loss of position instantly triggered panic, and funds began to withdraw from Ethereum. When the ETH price falls below the key support level, HyperLiquid's algorithmic liquidation mechanism is like a cold machine, immediately starting "automatic harvesting" - as long as your collateral is not enough to cover the loss, the system will force you to sell your position regardless of whether you are willing or not.

“I just finished adding a position, and before I could set a stop loss, my account was cleared. ”A retail investor trading on HyperLiquid posted a screenshot. He added a long ETH order with 8 times leverage. His position was forced to be liquidated in just 3 minutes as the price plummeted, and his 50,000 yuan principal was reduced to zero overnight. There are many such cases. According to market data statistics, the forced liquidation of ETH on the platform surged that day, and long positions of hundreds of millions of dollars evaporated in a short period of time.

What’s even more frightening is the “self-reinforcing downward cycle”: a group of people are liquidated, and a large number of selling orders drive down the price.； As the price continues to fall, more people's position closing lines are triggered, and new sell orders come out... It's like toppling dominoes that cannot be stopped at all. This is why ETH fell 3.4% in just 10 minutes, far exceeding normal fluctuations.

It’s not just ETH: the macro environment is “holding back””

The collapse of ETH is never an isolated incident, but a concentrated outbreak of "internal and external troubles" in the entire encryption market.

Let’s look at “foreign aggression” first—the cold wind of macroeconomics has been blowing. The Federal Reserve has been reluctant to cut interest rates, but has shown signs of delaying easing, which has put risk assets collectively under pressure. For cryptocurrencies, funds are the core driving force, but now money in the market is becoming more and more "cautious": Bitcoin spot ETFs continue to have net outflows, institutions are afraid to enter the market easily, retail investors are also tightening their wallets, and the liquidity of the entire market is getting worse and worse. Without funds to take orders, once a sell-off occurs, the price will inevitably fall sharply.

Let’s look at the “internal worries” again – traders’ “gambling nature” is harming themselves. Research data from the on-chain platform Arkham shows that in the early days of the ETH price decline, many people not only failed to stop losses, but instead repeatedly added long positions, thinking of "buying the dip and rebounding." This kind of operation may be able to make a little money in a stable market, but in the volatile crypto market, it is simply "giving away people's lives." It's like someone rushing up the mountain during an avalanche, only to be buried in a snowdrift.

The U.S. government's policy interference also makes investors feel uncertain. There have been constant rumors about encryption regulation recently. Although no clear policy has been introduced, "uncertainty" itself is the natural enemy of the market. In order to avoid risks, many institutions began to reduce their holdings of crypto assets, which further intensified the selling pressure.

Technical red light: Is the rebound a "trap" or a "dawn"?

Now open the technical chart of ETH, almost all of which are "short signals", making position holders panic.

Analysis from exchanges such as Binance shows that the relative strength index (RSI) of ETH has entered the "oversold range", which seems to be a signal of "falling into place", but combined with other indicators, it is not optimistic: the 5-day, 10-day, and 20-day moving averages are all arranged downward, forming a typical "short arrangement"”； There is a divergence in the KDJ index and the OBV indicator continues to weaken, which shows that the selling pressure has not yet been released.

Although ETH had a brief rebound on Thursday, once rising to $3166.1, this rebound soon failed. “A rebound without funds entering the market is all about "inducing bulls". ”Senior analysts cautioned that the current rebound is more like a "breath during the decline." If there is no subsequent large inflow of funds, prices are likely to fall again.

The data that best illustrates the lack of market confidence is that during the recent sell-off, the proportion of ETH long positions closed was as high as 77%. This means that out of 10 long traders, nearly 8 are running away in panic. No one dares to take orders anymore. The market's risk tolerance has hit rock bottom.

Survival guide for retail investors: Don’t let leverage destroy your principal

Faced with such a market, what should ordinary investors do? Instead of following your emotions, it is better to remember these 3 "survival rules":

First, never touch high leverage. More than 90% of those who liquidated their positions this time increased their leverage by more than 5 times. For retail investors, cryptocurrency itself is highly volatile, and there is no need to use leverage to amplify risks. Remember: there are plenty of opportunities in the market, only by keeping your principal can you wait for opportunities.

Second, be sure to set a stop loss. Regardless of whether you are long or short, set the stop loss line before entering the market. For example, set the stop loss of ETH below the integer mark of $3,000. Once it falls below, you will leave the market immediately. Don't have a "lucky mentality". In the currency circle, "living" is more important than anything else.

Third, keep an eye on the data and capital flows on the chain. If you see giant whales on the ETH chain beginning to quietly hoard coins, Bitcoin ETFs turning from net outflows to net inflows, and the issuance of stablecoins increasing, it means that new funds are starting to enter the market, and it is not too late to consider the layout at this time. On the contrary, if funds keep flowing out, don’t buy the bottom easily.

The currency circle has never been a playground for "gamblers", but an arena for "rational people". The liquidation storm of ETH once again reminds us: Leverage is a double-edged sword, which can make you rich overnight, but can also make you lose money in a second. In the current market environment, only by being less greedy and more cautious can you go further in the crypto market.