1. The Cryptocurrency Market Faces Large-Scale Liquidations, Leverage Risks Highlighted
On September 25-26, 2025, the cryptocurrency market experienced a sharp correction, with total liquidations across the network exceeding $1.15 billion within 24 hours, marking a recent single-day high. Ethereum (ETH) was hit the hardest, with liquidation amounts reaching $364 million, its price falling below the psychological threshold of $4,000, and a daily drop of over 6%. Bitcoin (BTC) saw liquidations totaling $460 million, with its price dipping to around $109,000. Other major tokens such as Solana (SOL) also saw declines of over 7%, with SOL liquidations reaching $80.7 million. Since September, the total global cryptocurrency market capitalization has evaporated by over $160 billion, and the Fear and Greed Index has dropped to 44, reflecting a rapid shift in market sentiment towards panic.
2. Macroeconomic Pressures, Risk Assets Under General Pressure
The immediate trigger for this market turbulence stems from a global contraction in risk appetite. On September 25, all three major U.S. stock indices closed lower, with the market adopting a cautious stance towards the upcoming Federal Reserve interest rate decision. Although there were moderate signals from policymakers, investors generally feared that the actual rate cuts might fall short of expectations, leading to tighter liquidity forecasts and impacting high-risk assets, including cryptocurrencies.
During this process, Bitcoin failed to demonstrate its “digital gold” safe-haven attribute. Instead, a large number of long-leveraged positions were liquidated, totaling $460 million. Ethereum quickly fell from a high of $4,200 to below $3,900, with liquidations mainly on the long side, indicating that excessive leverage accumulated during the previous uptrend was rapidly cleared out during the price correction. Solana, affected by high-leverage trading in meme coins and NFT projects within its ecosystem, also saw liquidations exceeding $80 million.
Asset/Indicator | Liquidation Amount (USD) | Price Change | Main Direction |
Total Network | $1.15 billion | — | Longs account for 91% |
Ethereum (ETH) | $43.8 million | Broke below $4,000, down 6.31% | Mainly long liquidations |
Bitcoin (BTC) | $460 million | Dipped to around $109,000 | Mainly long positions |
Solana (SOL) | $80.675 million | Dropped to $196, down over 7% | High leverage overlap |
Fear and Greed Index | 44 (Fear Zone) | — | — |
September Cumulative Market Cap Loss | Over $160 billion | BTC, ETH both saw significant corrections | — |
Data sources: CoinGlass, CoinDesk, Yahoo Finance
3. Structural Issues Exposed, High Leverage Amplifies Volatility
This liquidation event once again highlights the structural issues present in the cryptocurrency market, particularly the systemic risks brought by high-leverage operations. According to data platform statistics, long positions accounted for as much as 91% of all liquidated positions, reflecting the large amount of leverage accumulated during the market uptrend. Some trading platforms saw single liquidations exceeding $45 million, indicating that not only retail investors but also some institutions and large holders faced risks.
Regional data shows that Asian investors were more affected during this volatility, with higher average leverage levels further amplifying individual losses. Meanwhile, regulatory uncertainties, such as investigations by the U.S. Securities and Exchange Commission into related products, have also intensified market wait-and-see sentiment and suppressed the inflow of new funds.
4. Technical Analysis: Technical Analysis: Support Level Test and Potential Rebound Signals
● Ethereum (ETH)
Ethereum (ETH) has broken below the key support level of $4,000, forming a clear bearish channel with continued strong downward momentum. The support below the current price is relatively weak, and is expected to target the $3,775–$3,890 range, which is the overlap between the quarterly volume-weighted average price (VWAP) and the annual value area high (VAH). Further downside may reach the $3,600–$3,400 liquidation heatmap cluster. The MACD (12,26) indicator is deeply in negative territory, confirming a sell signal, with short-term bullish momentum weak. However, the RSI (14) has entered the oversold zone (near 30) and shows initial signs of bullish divergence. The daily K-line has broken below the lower Bollinger Band (BOLL), suggesting a potential short-term rebound opportunity.
● Bitcoin (BTC)
For Bitcoin (BTC), the $109,000 level is under significant pressure, with the current price testing the trend support bottom at $110,800. The key is to hold the $100,000 psychological support line to avoid further testing the monthly low of $98,000; if the $110,500 resistance area is broken, the rebound could extend to $113,900.
● Solana (SOL)
Solana (SOL) is currently bottoming around $196, with an RSI (14) of 35.803, also in a sell but oversold state, and a MACD (12,26) value of -3.26.
5. Market Outlook: Short-Term Pressure, Long-Term May Return to Fundamentals
Although current market sentiment is in panic, some indicators show that extreme pessimism often signals the formation of a stage bottom. Some analyses point out that institutional investors have continued to accumulate assets such as Ethereum during the price correction, which may indicate that long-term capital is still seeking allocation opportunities.
If there are signs of easing at the macro level, such as the Federal Reserve releasing clear dovish expectations or global stock markets stabilizing, the cryptocurrency market may see a technical rebound. However, investors should recognize that high volatility remains the main feature of the current market, and over-reliance on leveraged trading will continue to face significant risks.
In the medium to long term, as the regulatory framework becomes clearer and institutional participation increases, the market is expected to shift from speculation-driven to value-supported, but the process will still be accompanied by significant volatility. Investors are advised to remain cautious, focus on fundamental research, and manage position risks reasonably.
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