The crypto market witnessed one of the most brutal liquidation events in history on August 20, with $3.5 billion in leveraged positions liquidated in 24 hours.
At the height of the move, more than $1 billion in short positions were liquidated in just sixty minutes, with the number eventually reaching $3 billion. For comparison, just $264 million in long positions were liquidated in the 24-hour period, according to August 21 CoinGlassdata.
In what was the harshest lesson to short sellers since November 2021, Bitcoin (BTC) alone rose 8% to reclaim $71,300, a level not seen since the beginning of June, as the total crypto market capitalization gained approximately $280 billion. Ethereum (ETH) was likewise noteworthy, rising close to 20% on the day, with about $1.16 billion in liquidations.
To put it another way, the market gained north of $12 billion in market cap per hour on average for 24 hours straight.
According to the data, Binance recorded approximately $518 million in liquidations. Hyperliquid followed closely with roughly $513 million, while Bybit ranked third at around $303 million.
Hyperliquid’s near-match with Binance was particularly significant, as the decentralized perpetual futures platform’s liquidation volume highlights how much leveraged crypto trading activity has shifted toward decentralized derivatives markets over the past year.
Crypto liquidations surge after weeks of sideways trading
The latest liquidation event marked a stark contrast with most of 2026’s other major liquidation waves, which have punished long traders rather than short sellers. For instance, in June, two separate events erased approximately $1.8 billion and $1.76 billion, with bullish positions accounting for most of the losses.
This time, traders increasingly bet that Bitcoin would eventually break lower after weeks of sideways trading. But as short positions piled up, the market became increasingly vulnerable to an upside breakout. As a result, once Bitcoin pushed through, forced buying accelerated the rally and created a feedback loop that rapidly intensified the squeeze.
Crypto stocks also shot up as a result. Notably, Strategy (NASDAQ: MSTR) is up nearly 12% in pre-market trading at press time, while Coinbase (NASDAQ: COIN) is up 6%.
