Over the last 24 hours, crypto market liquidations have reportedly surpassed $590 million, coupled with an increased number of crypto market positions. The surge in liquidations follows South Korea’s President’s decision to enact martial law in the country, which caused heightened activity in crypto exchanges.
MN Consultancy founder and crypto analyst Michael van de Poppe has cautioned crypto investors of a pending market flash crash after weeks of bull run that saw digital currencies surge in prices.
In an X post, van de Poppe stated that market corrections might happen and that they would lead to a brief market crash. He urged crypto enthusiasts not to “panic” and called the scenario a “blessing.”
Crypto flash crashes are significant declines in crypto prices that usually take place within a short period. These drops cause mass liquidations that often wipe out billions in market value, leading to widespread panic selling and emotionally driven trading.
The crash historically precedes a gradual recovery as the market corrects itself while seeking a new equilibrium price.
BTC, XRP lead market liquidation volumes
The crypto market has experienced a downturn in the past 24 hours, with approximately $590.6 million in liquidations following South Korean President Yoon Suk-yeol’s now-reversed declaration of martial law.
According to a CoinGlass report, $87 million in Bitcoin (BTC) and $75.90 million in Ripple (XRP) positions were liquidated during this period. On-chain data shows that in the past 24 hours, 207,871 traders were liquidated. The largest single liquidation order happened on OKX – BTC-USDT-SWAP value of $15.09M
Bitcoin, Ether, and XRP all saw significant price drops following Tuesday’s political unrest in South Korea. This trend is not new. In 2022, the market bled following Russia’s invasion of Ukraine.
According to CoinMarketCap data, Bitcoin had rebounded by 2.4%, Ether gained 3.3%, and XRP recovered 9.2% by the end of the day.
XRP’s remarkable rally, which had seen the crypto rise by over 400% month-to-date, was temporarily halted following the crisis in South Korea. The price of XRP dropped by 8% on December 3 following President Yoon’s unprecedented martial law announcement.
The volatility was particularly evident on South Korean exchanges, with XRP’s price on Upbit, the country’s largest exchange by trading volume, plummeting more than 50% to $1.30. This sharp decline was exacerbated by the high concentration of XRP holders in South Korea.
Notably, XRP investors have been realizing profits at a staggering rate, with over $4 billion in profits taken over the past three days alone, as revealed by Santiment. The figure represents the highest profit-taking activity since April 2021.
CryptoQuant also shared data revealing a significant rise in the number of XRP tokens being moved into exchanges, from 46 million to 654 million in just seven days, signaling a wave of selling as traders mull thoughts of cashing out.
While the market saw an uptick in profit-taking, the overbought conditions in XRP, with its Relative Strength Index (RSI) reaching 74 and 84 on short—and long-term charts, suggest that buyer exhaustion may be at play.
Analysts predict a potential support level at $2.50, a possible entry point for those who missed out on XRP’s recent surge.
Bitcoin whales take up holding positions
Bitcoin whales are supposedly waiting for the coin’s price trend before making the decision to sell, according to CryptoQuant contributor Onat Tütüncüler. The market analyst observed a notable increase in Bitcoin inflows to crypto exchanges since Donald Trump’s election victory on November 5, which he revealed have largely not been sold.
In normal market standards, such large transfers signal potential sell-offs. However, according to Tütüncüler, the Adjusted SOPR metric hasn’t shown significant profit-taking, creating the indication that the BTC inflow in exchanges could be for reasons beyond short-term selling pressures.
Bitcoin almost reached the $100,000 mark after weeks of successive all-time highs, falling short by a mere $440 before dropping to $93,250, per Coingecko data. The growing market sentiment is a BTC price push to $100K is a “dream traders still believe.”
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