Crypto Futures Liquidations Hit $112M as Extreme Fear Grips Market

VADODARA, February 5, 2026 — Major cryptocurrency exchanges recorded $112 million in futures contract liquidations within a single hour, according to aggregated exchange data. This daily crypto analysis reveals a concentrated deleveraging event that coincides with Bitcoin breaking below the $69,000 support level. Market structure suggests this represents a classic liquidity grab amid extreme fear sentiment.

Investigation: The Liquidation Cascade and Market Mechanics

Exchange order books show the $112 million liquidation spike occurred between 14:00 and 15:00 UTC. Per the source data, total liquidations over the preceding 24 hours reached $1,428 million. This indicates sustained selling pressure rather than an isolated flash crash. Consequently, the majority of these liquidations were long positions, as price action broke through multiple technical levels.

Market analysts attribute this to cascading margin calls. When leveraged positions hit their liquidation thresholds, exchanges automatically close them, creating additional selling pressure. This process often accelerates during periods of low liquidity, which current volume profile data confirms. Underlying this trend is the Crypto Fear & Greed Index reading of 12/100, signaling extreme market fear.

Market Context & Historical Precedent

Historically, liquidation events of this magnitude precede volatility compression phases. The $1.4 billion 24-hour total mirrors patterns observed during the May 2021 and November 2022 corrections. In contrast to those events, current market structure shows higher institutional participation, potentially amplifying the impact.

Related developments include recent regulatory statements affecting sentiment. For instance, U.S. Treasury Secretary Bessent's demands for crypto regulation have contributed to uncertainty. Additionally, Bitcoin's break below $69,000 support and Ethereum's plunge on Upbit reflect broader market stress. These factors combine to create a high-volatility environment where liquidations become self-reinforcing.

Technical Architecture & Price Action

Bitcoin's price action broke the $69,000 support, a level that had held since early January. This created a Fair Value Gap (FVG) between $69,000 and $67,500. Market structure suggests this gap will act as immediate resistance on any rebound attempt. The Relative Strength Index (RSI) on the 4-hour chart currently reads 28, indicating oversold conditions but not yet extreme capitulation.

Critical support now lies at the weekly 50-period moving average of $62,800. A break below this level would invalidate the bullish market structure established in Q4 2025. , on-chain data from Glassnode shows increased movement from long-term holders to exchanges, suggesting distribution pressure. This technical setup resembles the Order Block formation seen before the March 2024 correction, where liquidations preceded a 20% drawdown.

By The Numbers

Why It Matters

Futures liquidations directly impact market liquidity and volatility. When $112 million in positions are forcibly closed within an hour, it creates a vacuum that algorithms and market makers exploit. This often leads to exaggerated price movements beyond what spot market fundamentals would justify. Consequently, retail traders face increased slippage and margin calls, while institutions may use these events to accumulate at discounted prices.

The extreme fear sentiment, as quantified by the 12/100 index score, typically marks local bottoms in historical cycles. However, this requires confirmation through price action reclaiming key levels. Market structure suggests the current environment resembles the liquidity flush seen before the 2023 rally, where similar liquidation events preceded a 150% Bitcoin appreciation over nine months.

Expert Commentary

"The concentration of liquidations in a single hour indicates algorithmic trading triggers rather than organic selling. Market makers likely identified clustered stop-loss orders around the $69,000 level and executed a liquidity grab. This creates both risk and opportunity—while short-term pain is evident, such events often reset leverage to healthier levels for the next leg up." — CoinMarketBuzz Intelligence Desk

Market Outlook & Price Scenarios

Two primary technical scenarios emerge from current market structure:

• Bullish Invalidation Level: $69,500. A daily close above this resistance would fill the FVG and suggest the liquidation event was a bear trap, potentially triggering a short squeeze toward $72,000.
• Bearish Invalidation Level: $62,800. A sustained break below the weekly 50 MA would confirm distribution and target the next Fibonacci support at $58,400 (0.618 retracement from the 2025 low).

The 12-month institutional outlook remains cautiously optimistic despite near-term volatility. Historical patterns indicate that liquidation events of this scale often precede consolidation phases that last 4-6 weeks before resuming the primary trend. For the 5-year horizon, this volatility represents normal market mechanics within a secular bull market, as evidenced by Bitcoin's 200-week moving average continuing its upward trajectory.