Bitcoin Plunges to $60K: $2.6B Liquidated in 24-Hour Crypto Crash

The scale of Thursday’s decline was staggering, marking one of Bitcoin’s worst single-day performances since its inception. In the span of just 24 hours, the flagship cryptocurrency lost over $17,000 in value, at times falling more than $2,000 in a matter of minutes. The carnage extended across the market, with multiple altcoins registering profound losses of up to 20%. The total value of wrecked leveraged positions soared to $2.6 billion, a clear indicator of the intense selling pressure and forced liquidations that characterized the session. The collapse wiped out months and years of progress, returning Bitcoin and other major cryptocurrencies to price levels last seen before the U.S. presidential elections at the end of 2024.

This dramatic event shifted the market narrative decisively. As noted in the source analysis, “It’s safe to say that this is no longer a bull phase.” The focus moved from long-term trends to the immediate, catastrophic events of the day, highlighting a market in severe distress. The velocity and depth of the drop pointed to more than just retail panic; it suggested a fundamental dislocation in market structure and liquidity.

According to the Kobeissi Letter, the root cause of the current turmoil lies not in the past several months of decline but in a specific, pivotal event: the October 10 crash. On that day, over $19.5 billion in leveraged positions were liquidated, a record amount that analysts believe caused “something structural” to shift in the market. They argue that markets “never truly recovered” from that event, setting the stage for the recent collapse.

The analysts note that while Bitcoin remained rangebound for two months between mid-November and mid-January, the period was punctuated by brief, violent liquidations with “gaps” in both directions—a signature of structural instability. Crucially, they identify market sentiment as “all that matters” during crypto cycles, and contend it was fundamentally broken after the October crash. This created a self-reinforcing “massive virtuous cycle, shifting from liquidations to sentiment deterioration, and back.” Since January 24 alone, approximately $10 billion in levered positions have been liquidated, representing about 55% of the record October 10 figure and underscoring the ongoing structural decline.

Further evidence of this breakdown includes the spread of selling pressure into other asset classes and a critical metric: Bitcoin’s market depth. Market depth, which measures the capital available on order books to absorb large trades without significantly moving the price, remains more than 30% below its October peak. The last time it hovered at such depleted levels was following the catastrophic collapse of the FTX exchange in 2022, drawing a stark parallel between two of crypto’s most severe crises.

The violent and rapid nature of Thursday’s decline led the Kobeissi Letter analysts to a specific conclusion: “It seems that a large player, perhaps an institutional investor, sold/liquidated during today’s session.” The pattern of Bitcoin falling thousands of dollars in minutes is consistent with a massive, concentrated sell order or the forced liquidation of a hugely leveraged institutional position, adding a layer of systemic pressure to the retail-driven liquidations.

In the aftermath of such a crash, the inevitable question is: when will the market find a bottom? The analysts posit that Bitcoin will bottom only once “structural liquidity is restored.” This restoration, they explain, “will be a combination of both capitulation in price and leverage, as well as maximum bearish sentiment.” In essence, the market must purge itself of excessive leverage and reach a peak in pessimism before a foundation for recovery can be built. The analysts offer a sliver of hope, noting that “we seem to be somewhat near that point,” suggesting the intense pain of the recent wipeout may be exhausting the selling pressure.

The $2.6 billion Thursday wipeout, therefore, stands as a stark symptom of a deeper, months-long structural ailment that began with October’s record liquidation. The path forward hinges not on fleeting rallies but on the arduous process of rebuilding market depth, restoring shattered sentiment, and flushing out the final remnants of excessive leverage from the system.