The crypto market cap has printed its first red weekly candle after four consecutive green ones. The bullish momentum appears to be losing steam, and the pullback has triggered liquidations for short-term traders.
What triggered this week’s correction, and what does it mean going forward?
Nearly $1 Billion Liquidated as Market Cap Falls in Final Week of July
According to TradingView data, the overall crypto market cap dropped by 5% this week, from nearly $4 trillion to $3.78 trillion. However, the altcoin market cap (TOTAL2) plunged more sharply. It fell almost 10%, from $1.57 trillion to $1.4 trillion.
Altcoins corrected more steeply than Bitcoin, which caused losses for short-term derivatives traders. Coinglass reported nearly $1 billion in liquidations over the past 24 hours.
Liquidation Data of July 24. Source: Coinglass
“In the past 24 hours, 314,302 traders were liquidated. The total liquidations come in at $966.04 million,” Coinglass reported.
Of the nearly $1 billion liquidated, over $840 million came from long positions, accounting for about 84%. This highlights the failure of many short-term traders who used leverage and expected prices to continue rising this week.
In addition, data from CryptoBubbles showed that nearly all altcoins dropped sharply today, with losses ranging from 6% to over 20%.
Altcoin Price Performance on July 24. Source: CryptoBubbles
This move could be seen as the first wave of profit-taking after four straight weeks of rising market cap.
Who’s Taking Profits?
According to a new report from 10x Research, Asian trading hours were the main driver of the recent rally.
While Bitcoin posted a +16% gain overall, Asian hours alone contributed +25% to that rise. This means that both Europe (-6%) and the US (-3%) actually saw net selling, likely due to profit-taking.
A similar pattern emerged with Ethereum. ETH has surged 63% in the past month—an impressive gain. Yet nearly all of that (+96%) occurred during Asian trading hours. In contrast, Europe (-26%) and the US (-7%) sold as the price rose.
Ethereum Performance during Asia Trading Hours. Source: 10x Research
“Although some of this may be due to treasury-related news emerging after US market hours, the more likely explanation is heightened enthusiasm and aggressive buying from Asian traders,” the report explains.
According to the study, US and European investors may be locking in profits. Ironically, they were also the source of the positive news that fueled the strategic crypto accumulation narrative.
It seems Asian traders were FOMO-ing based on news from the other half of the world, only to be hurt today by the very same headlines.
However, this kind of pullback may not be enough to indicate a long-term downtrend. Many analysts see it as a natural profit-taking phase, believing the broader trend remains intact.
“Not concerned with the dip in alts today. It was a sensible sell-off considering how much everything has gained recently. The most important thing is BTC held strong. Alts will bounce soon enough—likely even harder than their last leg up. Patience pays. Be more bullish,” KALEO, investor and founder of LedgArt, predicted.
CZ, founder of Binance, also viewed this correction as simply “a dip again.”
At the time of writing, the market sentiment remains in “greed” territory. Despite nearly $1 billion in liquidations, there’s still no sign of panic.
