Major tokens and midcap cryptocurrencies experienced one of their worst days in recent months, with a sharp decline early on Tuesday during Asian trading hours, even though Bitcoin (BTC) remained relatively stable.
XRP, Dogecoin (DOGE), and Cardano’s ADA saw significant drops, falling as much as 15% in the past 24 hours, according to data. The selling pressure started late in the U.S. trading hours and intensified during the early Asian session. Bitcoin dropped 3%, while Ether (ETH) and Solana (SOL) fell 7%. Tron’s TRX nearly erased all of last week’s gains, plunging 17%.
The overall market capitalization took a hit, dropping 6.5% — the largest decrease since October — and the broad-based CoinDesk 20 (CD20) index slumped by 7%.
While no immediate trigger for the sell-off was identified, the market turmoil coincided with news from Google about its new Willow quantum computing chip and its benchmark tests. This announcement sparked concerns in the crypto community about the potential impact on privacy and wallet security.
Analysts and traders had already warned of short-term selling pressure after the November rally, highlighting the possibility of an overheated market, as CoinDesk reported earlier on Monday.
The downturn led to over $1.5 billion worth of long, or bullish, positions being liquidated — the highest such figure since 2021. Altcoin futures, particularly under the “Others” category tracked by data provider CoinGlass, saw heavy losses, with $560 million liquidated in an unusual move. Dogecoin and XRP futures accounted for more than $70 million in losses each.
Market observers noted that the selling pressure first surged from U.S.-listed Coinbase, where XRP saw an unusual market impact. Indicators suggested that traders were over-leveraged, contributing to the sell-off.
“Something absolutely strange happened,” said quant trader @ltrd_ on X. “On a large, relatively mature market, we saw a cascade of big sell orders that caused the market to drop by over 5%. We don’t know exactly what happened, but it’s definitely unusual.”
“You can tell those sell orders were not normal,” they added. “Perhaps a major player was forced to sell as if there was no tomorrow.”
Liquidations occur when exchanges forcibly close a trader’s leveraged position due to an inability to meet margin requirements. Large-scale liquidations can indicate extreme market conditions, such as panic selling or buying. A cascade of liquidations can signal a turning point, where a price reversal may be imminent due to overreaction in market sentiment.
