Bitcoin dropped from $81,000 to just under $65,000 on Saturday, continuing a broader market decline. The weekend timing of the sharp move drew attention, as significant price movements typically occur less frequently during this period without major catalysts.
Analyst Ted Pillows investigated the cause of the latest leg down, addressing speculation that major holders had dumped substantial positions. After examining on-chain data, Pillows found no evidence of large sell-offs exceeding $50 million or significant exchange deposits that would indicate whale activity.
Instead, Pillows attributed the crash to excessive leverage in the market. According to his analysis, $200 million in long positions were liquidated within a single hour as Bitcoin dipped below $66,000. Liquidations accelerated throughout Saturday, reaching over $500 million in total value, with approximately 94% of liquidations coming from longs.
"So this is forced selling, not whales dumping," Pillows concluded, characterizing the move as a consequence of leveraged positions being unwound rather than deliberate capital withdrawal by major players.
Analyst Crypto Rover highlighted another concern: rapid stablecoin outflows from the cryptocurrency market. On-chain data showed the stablecoin market cap declined by approximately $9 billion during the latest downturn, a 4.86% decrease. This stablecoin outflow was proportionally larger relative to Bitcoin's 24%-25% price decline compared to previous crashes earlier in the year.
Crypto Rover compared the metric to prior market stress events. In May, Bitcoin crashed 30.11% while stablecoins declined 3.70%. During January's 38.42% Bitcoin decline, stablecoin market cap dropped less than 2%. The recent ratio raised concerns about liquidity conditions in the broader market.
