Traders say BTC leverage cleanouts underway

APRiCiTY, a trader posting on X, wrote on May 23 that “the market getting fearful while BTC is still above key levels is not automatically bearish,” adding that such conditions can be how leverage is “cleaned out before the next move.” The post, published under ID 2058163697424425327, circulated as Bitcoin derivatives markets showed a heavy wave of long liquidations across major venues. CoinGlass data on May 23 showed $378.3 million in 24-hour Bitcoin liquidations, with $353.2 million, or 93.35%, coming from long positions. CoinMarketCap’s liquidation dashboard showed nearly the same split, listing Bitcoin at about $378.3 million in total liquidations over 24 hours while broader crypto liquidations reached $939.0 million. ### What are traders referring to when they say a “leverage cleanout” is underway? (x.com) CoinGlass defines Bitcoin liquidation as the forced closing of leveraged positions when a trader’s margin can no longer support the trade after adverse price moves. In practice, that usually means exchanges automatically close futures or perpetual positions to prevent balances from going negative. CoinMarketCap says liquidation waves can add sudden buying or selling pressure because exchanges close positions automatically. (coinglass.com) When long positions are liquidated during a pullback, that forced selling can intensify the move and trigger additional liquidations in a feedback loop. ### How large was the May 23 Bitcoin wipeout? CoinGlass listed 14,678 traders liquidated worldwide in Bitcoin markets on May 23, with the largest single liquidation at $32.4 million. (coinglass.com) The same page said Bitcoin price volatility exceeded 4.33% on the day and that liquidation activity was running at 3.29 times the seven-day average. CoinMarketCap’s dashboard put Bitcoin’s open interest at $97.32 billion while showing a Bitcoin price near $74,651 on the same day. (coinmarketcap.com) That combination — large open interest and a lopsided long wipeout — is consistent with traders describing a flush of leveraged bullish positioning rather than a balanced two-way washout. That is an inference drawn from the liquidation data. ### Which exchanges were seeing the heaviest pressure? (coinglass.com) CoinGlass said Binance accounted for 27.96% of Bitcoin liquidations over 24 hours, followed by Bybit at 20.37% and Hyperliquid at 18.42%. Bitget ranked next at 16.48%, with Gate at 5.7% and Bitfinex at 5.06%. Those rankings matter because they show the selling pressure was not isolated to one venue. The exchange breakdown points to a broad derivatives reset across offshore crypto platforms where leveraged trading is concentrated. (coinmarketcap.com) That is an inference based on CoinGlass’s venue distribution. ### Why does fear matter if Bitcoin is still above “key levels”? APRiCiTY’s May 23 post argued that fear by itself is not a bearish signal when Bitcoin is still holding important price areas. (coinglass.com) The trader’s point was that sentiment can deteriorate before structure breaks, and that the market can use that stress to force out over-leveraged positions. CoinGlass’s May 23 figures support at least part of that setup: the day’s liquidation flow was overwhelmingly skewed toward longs, not shorts. (coinglass.com) CoinMarketCap also showed Bitcoin remained the largest single source of crypto liquidations in the market at the time of the snapshot. ### What should readers watch next in the data? May 23 dashboards at CoinGlass and CoinMarketCap were still updating in real time, with both services tracking hourly liquidation flows, open interest and exchange concentration. (x.com) Traders watching whether the cleanout is ending were focused on whether long-liquidation totals keep rising and whether Binance, Bybit and Hyperliquid remain the main venues absorbing the pressure. (coinglass.com)