Altcoins Bleed Out: Crypto Market Sees $1.7 Billion Liquidation Storm to Start the Week

Crypto markets got sucker-punched Monday as leveraged traders faced a brutal reckoning. Altcoins—the speculative darlings of retail investors—took the heaviest blows.

Blood in the water as liquidations hit $1.7B

Exchanges executed mass forced closures of overleveraged positions—a classic 'bull trap' scenario. Ethereum, Solana, and meme coins led the carnage while Bitcoin showed relative resilience (as usual).

When the tide goes out, you see who's swimming naked

The wipeout exposes crypto's dirty secret: most 'investors' are just gamblers with a Binance account. Traders now face the age-old question—buy the dip or flee to stablecoins? Meanwhile, Wall Street sharks are probably circling to scoop up cheap assets (before the next pump).

Same cycle, different week. The only certainty? Someone's getting rich—and it's not the guy reading this on his phone during his lunch break.

Bitcoin Dominance Rises as Altcoins’ Value Drops

The sell-off also brought a sharp reversal in market sentiment. The Altcoin Season Index, which peaked at 100 points just days ago, has now dropped to 64, suggesting traders are shifting back toward Bitcoin. BTC dominance has climbed to 57%, while ETH dominance slipped to 13%.

Historically, altcoin seasons last only a few weeks before liquidity rotates back into Bitcoin. Analysts warn that the latest liquidation cascade may have ended this cycle earlier than expected.

Smaller tokens, including ASTER, WLFI, and PUMP, which recently saw speculative surges, were among the hardest hit, with more than $263 million in altcoins longs liquidated.

Healthy Shakeout or Bearish Warning?

Despite the steep losses, many analysts argue the pullback reflects a healthy reset rather than the end of the bull cycle. Overleveraged traders were washed out, creating stronger support levels for long-term holders.

Institutional demand remains intact, with Bitcoin and ethereum ETFs recording steady inflows last week, suggesting that large investors continue to buy the dip. On-chain data also shows 420,000 ETH leaving exchanges, pointing toward accumulation despite short-term volatility.

For now, the market’s next move hinges on whether Ethereum can hold above $4,100 and Bitcoin stabilizes near the $112,000–$114,000 zone. Despite skepticism from traders, analysts predict a correction as laying the groundwork for the next upward move in the ongoing bull market.

Cover image from ChatGPT, ETHUSD chart from Tradingview