Bitcoin Slides Below $89K as Global “Risk-Off” Wave Triggers $1B in Crypto Liquidations

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• Bitcoin and Ethereum dropped sharply as global markets shifted into risk-off mode.
• Over $1 billion in liquidations amplified losses across crypto derivatives.
• Japan’s bond market turmoil played a central role in triggering broader panic.

Bitcoin and major cryptocurrencies tumbled late Tuesday as a broad risk-off move swept through global markets, pulling digital assets into a wider sell-off across stocks and bonds. The sudden downturn reflects growing macro uncertainty rather than crypto-specific weakness, but leveraged traders bore the brunt of the move.

Bitcoin dropped more than 4% in 24 hours, sliding from above $92,000 earlier in the day to around $88,700 by Tuesday evening. Ethereum fell even harder, losing over 7% as selling pressure intensified across large-cap tokens.

Global Markets Turn Defensive

The crypto decline closely tracked sharp losses in U.S. equities. Major stock indexes posted their worst session in months, signaling a clear shift away from risk assets. As investors reduced exposure, crypto — often treated as a high-beta asset — followed suit.

Crypto-linked stocks also came under pressure. Shares of major exchanges, stablecoin issuers, and publicly traded firms with large digital asset treasuries all fell sharply, reinforcing the link between crypto prices and broader market sentiment.

Leverage Unwinds Accelerate the Drop

Analysts say forced liquidations amplified the move. As prices fell, overleveraged long positions were rapidly closed, creating a cascade effect across derivatives markets. In total, more than $1 billion in crypto positions were liquidated in just 24 hours, with long trades accounting for the vast majority.

This kind of leverage flush often turns modest declines into sharp, fast sell-offs — especially during periods of heightened macro stress.

Japan’s Bond Shock Sparks “Japanic”

The deeper trigger appears to be overseas. A sharp sell-off in Japanese government bonds pushed long-term yields to multi-decade highs, rattling global markets. Given Japan’s role as a major holder of foreign debt, the move sent shockwaves through bonds, equities, and currencies.

Traders dubbed the resulting panic “Japanic,” as fears spread that political uncertainty and fiscal shifts could force central banks back toward aggressive monetary support. Some market participants now see renewed money printing as increasingly likely.

Key Levels and What Comes Next

Bitcoin is now hovering near a critical support zone between $87,000 and $88,000. A clean break below that range could open the door to a deeper pullback toward $85,000. For stabilization, traders are watching for cooling leverage, clearer central bank signals, and signs of renewed institutional demand.

For now, crypto remains firmly tied to macro forces — and until global markets regain confidence, volatility is likely to stay elevated.

Disclaimer: The information in this article is for general purposes only and does not constitute financial advice. The author’s views are personal and may not reflect the views of Chain Affairs. Before making any investment decisions, you should always conduct your own research. Chain Affairs is not responsible for any financial losses.