Major liquidations in Bitcoin and ETH reach $1.6 billion! What is driving the latest crypto correction?

Bitcoin plunged sharply on Friday, dropping to $59,100 and hitting its lowest point of 2026. The market quickly saw a rebound as buy orders stacked up above the $60,000 threshold. As of Saturday, BTC had stabilized around $60,702, leaving it about 1% lower on a daily basis.US jobs data put pressure on risky assets$1.6 billion in liquidations take a toll on cryptoThe number of underwater Bitcoins climbs to 10.46 millionStrategy divestment and ETF outflows deepen the pressure US jobs data put pressure on risky assetsThe sharp downturn was triggered by stronger than expected US labor market data. Nonfarm payrolls for May jumped by 172,000, significantly above the market forecast of 85,000. Figures for April were also revised up by 64,000 jobs. This fueled expectations that the Federal Reserve may delay interest rate cuts. As a result, bond yields surged, the US dollar strengthened, and risk-sensitive assets came under renewed pressure.Stocks were swept up in the sell-off. The Nasdaq 100 dropped nearly 5%, while the S&P 500 lost 2.6%. The exodus from risky assets extended into the cryptocurrency space, causing notable losses across the board.$1.6 billion in liquidations take a toll on cryptoThe wave of selling in crypto markets sparked a rapid chain of liquidations among leveraged traders. According to CoinGlass data, roughly $1.6 billion in positions were wiped out over the past 24 hours. Longs took the biggest hit, suffering the largest losses as prices tumbled. More than $500 million in BTC positions and over $400 million in ETH positions were liquidated. Glossary: Liquidation means an automatic closure of a position by the exchange when collateral is insufficient in leveraged trading. CoinGlass is a data platform tracking open interest, funding rates, and liquidation statistics for the crypto derivatives market.IndicatorDataTotal liquidations$1.6 billionBitcoin liquidationsOver $500 millionEthereum liquidationsOver $400 millionAltcoins mirrored these losses. Ethereum has shed more than 20% over the past week alone, while Solana, XRP, Dogecoin, and BNB have all posted double-digit declines within the same period.Market analyst Daan Crypto Trades emphasized that Bitcoin has now erased the entirety of its spring rally, highlighting that while gains had been gradual, the recent decline happened much more abruptly.The number of underwater Bitcoins climbs to 10.46 millionOn-chain data analyst Ali Charts drew attention to a closely watched market indicator. According to his analysis, 10.46 million BTC are currently in loss territory. Historically, such levels have aligned with key market bottoms in previous cycles.Ali Charts noted that as more coins are held at a loss, selling pressure can ease, which often heightens the probability of a market bottom forming.Strategy divestment and ETF outflows deepen the pressureInvestor anxiety was exacerbated by another major development from the Strategy company, which disclosed its first sale of some Bitcoin holdings since 2022. Although the sale constituted only a small fraction of its overall portfolio, this move sparked discussions about whether more institutional selling could be on the horizon. Strategy is well-known for holding substantial Bitcoin reserves on its balance sheet.Meanwhile, US-listed spot Bitcoin ETFs have experienced consecutive weeks of net outflows, a sign that one of the market’s strongest sources of demand is weakening. Market observer Exitpump pointed out that funding rates turning negative may signal sellers are losing momentum. The crucial $60,000 mark for BTC is now under close watch as investors look for signs of stability.Disclaimer: The information contained in this article does not constitute investment advice. Investors should be aware that cryptocurrencies carry high volatility and therefore risk, and should conduct their own research.