Bitcoin Liquidations Cross $500 Million 13 Times in One Year: Report

Highlights:

• Bitcoin liquidations exceeded $500 million on 13 days over the past year, including three billion-dollar events.
• Market analysts say growing leverage and thinner trading conditions can turn sharp price drops into forced selling.
• US Bitcoin ETFs lost about $1.07 billion this week, adding pressure as investors reduced their market exposure.

Bitcoin (BTC) traders have lost billions of dollars over the past year. Liquidations crossed $500 million on 13 different days. Three of those days saw losses of more than $1 billion. Another sell-off hit the market on November 13. US Bitcoin ETFs also saw fresh withdrawals. Analysts say many traders are using borrowed money to make bigger bets, which puts them at greater risk when prices fall.

According to a November 13 Bloomberg report, the findings come from CoinGlass liquidation data covering 28 futures exchanges.

Bitcoin Liquidations Cross $500 Million on 13 Occasions

Large Bitcoin liquidations have become more frequent over the past 12 months. Bloomberg reported that Bitcoin positions worth more than $500 million were liquidated on 13 separate days during that period. Three sessions saw losses exceed $1 billion. The pattern continued on November 13, when roughly $1.3 billion in bullish positions were liquidated across the broader crypto market over 24 hours. Bitcoin accounted for the largest share.

Paul Howard, senior director at trading firm Wincent, told Bloomberg that large liquidation events have become more common over the past year. He linked the increase to traders taking bigger risks with borrowed funds. When prices fall suddenly, those positions can suffer heavy losses. The latest figures also show how much activity has moved into crypto derivatives. According to Bloomberg, derivatives now account for roughly three-quarters of cryptocurrency trading volume.

Why Bitcoin Traders Face Bigger Liquidation Losses

Leverage allows traders to open positions larger than the money they actually hold. However, even a relatively small price movement can wipe out the funds backing those trades. When a position loses too much value, exchanges may close it automatically. Several closures happening together can put additional pressure on prices.

Alex Kuptsikevich, chief market analyst at FxPro, told Bloomberg that derivatives trading has become common even among investors with limited capital. He also pointed to lower market liquidity before European trading begins. With fewer large investors active during those hours, sudden selling can move prices more sharply and trigger further liquidations.

Not everyone believes these events point to deeper problems with Bitcoin. Fabian Dori, chief investment officer at Sygnum Bank, argued that large liquidations mainly reflect how traders use leverage rather than Bitcoin’s underlying value.

Bitcoin ETF Withdrawals Add to Market Pressure

The liquidation figures come during another difficult week for Bitcoin investment funds. According to Farside Investors, US spot Bitcoin ETFs recorded approximately $1.07 billion in net outflows between November 9 and November 13. The funds lost $299.8 million on November 11 and another $284.1 million on November 12. Withdrawals continued on November 13, reaching $185.4 million.

BlackRock’s iShares Bitcoin Trust (IBIT) accounted for $143.5 million of Friday’s outflows, while Fidelity’s FBTC lost $41.9 million. Investors are also dealing with concerns about inflation, possible Federal Reserve rate hikes, and weaker technology stocks. Bloomberg noted that some investors may now see better buying opportunities in artificial intelligence stocks rather than cryptocurrencies.

Since the launch of U.S. spot Bitcoin ETFs, Bitcoin is increasingly attracting investor funds away from other major investments, said Noelle Acheson, author of the Crypto Is Macro Now newsletter. Bitcoin is facing selling pressure due to a lack of withdrawals from ETFs and losses from leveraged trading. But simply large liquidations are not sufficient to determine whether prices are going to keep going down.

At the time of writing, Bitcoin was trading around $67,225, down 2.96% over the previous 24 hours, according to CoinMarketCap.