Analyst: $1.1T Wipeout Signals Crypto Market Shift

A 41-day liquidation cascade erased $1.1 trillion from the crypto market, marking a significant contraction in its history, according to analyst Shanaka Anslem Perera. He frames this event as the end of the high-leverage era and the beginning of an institution-driven trading environment.

Perera’s research showed that digital asset venues shed approximately $27 billion in value per day between October 6 and November 27. During this period, Bitcoin fell from a peak above $126,000 to lows around $93,000 – a roughly 25% decline that he considers a decisive downturn. Open interest in BTC perpetual futures had reached over $40 billion by early October, with high funding rates indicating significant long positioning. Macroeconomic pressures, including dollar liquidity tightening, a potential U.S. government shutdown, and trade frictions, triggered the unwinding of these leveraged positions.

One liquidation event on October 10 resulted in a loss of around $19.2 billion, representing the largest forced closure in crypto history. Mid-November saw further declines, with BTC dipping just above $93,000 on November 27 after trading near $106,500 earlier in the week. The drop occurred despite hints of a potential U.S.-China trade deal.

Ethereum (ETH) is currently priced near $3,200, down more than 12% in the last seven days. Other majors like XRP, BNB, and Solana (SOL) have dropped between 8% and 17% over the same period, according to CoinGecko data. Perera attributes the root cause to an arena oversaturated with leverage, where 1-2% price movements triggered automatic liquidations due to leverage ratios of 50x or 100x.

Many analysts believe this episode indicates a shift in how the crypto market operates. Perera echoes previous analysis suggesting that Bitcoin’s halving cycles have been invalidated by the rise of spot ETFs and institutional strategies. BTC now reacts more directly to dollar liquidity, interest-rate expectations, and equity volatility. Data hints at a move from forced selling to quiet accumulation, with the Fear and Greed Index at its lowest point since February and stablecoin supply expanding by nearly $20 billion this year.

Disclaimer: What is written here is not investment advice. Cryptocurrency investments are high-risk investments. Every investment decision is under the individual’s own responsibility.