According to data from CoinGlass, the volume of forced liquidations of short positions on cryptocurrency exchanges surged past $1 billion between July 10 and 11, 2025. The analytics platform highlighted that this marks the highest daily liquidation figure since 2021, signaling a significant market event.
Forced liquidation occurs when a trader using leverage loses a substantial portion of their collateral due to adverse market movements. For those holding short positions — betting on a price decline — rising prices can trigger these liquidations. When losses reach a critical threshold, exchanges automatically close these positions to limit further losses.
Such events can lead to a short squeeze, where the price surges as liquidated short positions are forcibly closed through buy orders. This creates additional upward pressure, amplifying market momentum and driving prices even higher.
Thanks to the transparency of transactions on crypto exchanges, platforms like CoinGlass can track liquidations in real time. These insights serve as a key indicator of market sentiment, helping traders and analysts gauge demand dynamics and assess potential risks.
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The record-breaking liquidations on July 10-11 underscore the volatility and high-stakes nature of leveraged trading in the crypto market, reflecting both the opportunities and risks inherent in such conditions.
