The sharp decline in the cryptocurrency market over the weekend tested the composure of investors. While more than $19 billion in leveraged positions were liquidated in total, this figure reached approximately 10 times the amount of liquidation in the FTX crash in 2022. Bitcoin during selling pressure 
$115,083.26‘s spot transaction volume increased, but interestingly, this volume increase did not occur at the bottom of the market, but during periods when the price was horizontal.
Glassnode Data Shows Historic Deleveraging
Wolf of All Streets podcast host Scott Melkel made a remarkable point in his post based on Coinbase data. According to Melkel, the sharp decline experienced by Bitcoin on Friday was not the highest volume day of this summer. Two days in July saw much higher transaction volumes; yet the price had barely moved. He stated that this situation revealed that the recent decline was a “leverage collapse” rather than a broad-based panic selling.
According to on-chain data platform Glassnode, Friday’s crash was recorded as the largest futures liquidation in Bitcoin history. This process, in which the open position of 11 billion dollars was deleted, was described as a “historical deleveraging event” in which speculative excesses in the market were reset. During the same period, funding rates in the crypto market fell to the lowest levels seen since the 2022 bear market. Analysts state that clearing overly leveraged transactions from the system may pave the way for a healthier price structure in the long run.
Similar Shock Was Also Seen in Ethereum and Altcoins
Ethereum with the collapse in Bitcoin 
$4,157.04 It was also withdrawn to the level of 2,600 dollars. Solana, XRP and Avalanche 
$22.75 There were also double-digit declines in popular altcoins such as. For XRP investors in particular, this has meant that the price has failed to maintain the support level despite increased trading volume in recent weeks. On the other hand, some analysts predict that after these declines, liquidity may shift to large projects again in the short term.
As a result, the cryptocurrency market once again reminded of its risky nature with chain liquidations created by leveraged transactions. However, such clean-up moves can also be seen as a necessary step for long-term stability by resetting the overheated leverage structure of the market. Whether Bitcoin can stay above the $114,000 level in the coming days is critical for the return of investor confidence.
