Bitcoin Drops to $86,000 Triggering $1.6 Billion in Liquidations

Bitcoin’s sharp decline to $86,000 has triggered a wave of liquidations totaling $1.6 billion over the past 24 hours, according to data from Coinglass. The selloff marks Bitcoin’s first dip below $86,000 since November, highlighting mounting market volatility amid macroeconomic concerns.

Market Selloff Intensifies Amid Renewed Trade War Fears

The price drop has been linked to President Donald Trump’s renewed threats of tariffs on Mexico and Canada, reviving trade policy uncertainty and prompting institutional investors to reduce risk exposure.

Adding to the downward pressure, a $500 million selloff in Bitcoin exchange-traded funds (ETFs) exacerbated the decline, intensifying liquidations across major cryptocurrencies.

Mass Liquidations Impact Hundreds of Thousands of Traders

The sudden downturn wiped out leveraged positions, affecting between 286,534 and 367,789 traders. The vast majority of liquidations were long positions, with losses ranging from $144 million to $1.4 billion.

• Bitcoin, Ethereum, and XRP were among the most impacted digital assets.
• Ethereum traders also saw significant liquidations, mirroring broader market losses.

This event follows an even larger liquidation wave on February 3, 2025, when over $2.2 billion in leveraged positions were wiped out, affecting approximately 729,073 traders.

• During that event, Ethereum traders lost over $600 million, while Bitcoin traders faced $409 million in liquidations.

Trade Policy Uncertainty and Institutional Outflows Drive Volatility

The resurgence of trade tensions has heightened concerns about economic disruptions, leading to increased volatility across financial and crypto markets. Trump’s latest statements on trade policy have rekindled investor anxiety, following his earlier February 3 announcement that initially shook markets.

The combination of policy uncertainty and institutional investor outflows from Bitcoin ETFs has deepened the recent selloff, reinforcing short-term market instability.

Bitcoin’s Path Forward: More Volatility Ahead?

As macro risks persist, Bitcoin remains vulnerable to further price swings. While some traders view the $86,000 level as a potential buying opportunity, others warn of continued market corrections if selling pressure continues.

Market participants will be closely watching institutional flows, regulatory developments, and broader economic indicators to assess Bitcoin’s next move in the wake of this latest downturn.

Source: Bitcoin crashes to $86,000, triggers $1.6 billion liquidation in 24 hours