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Hidden Crypto Market Liquidations May Have Erased $10B Overnight

  • Bybit CEO claims overnight crypto liquidations may total $8-10B, much higher than reported.
  • API limits recorded only $333M of Bybit’s $2.1B liquidations.
  • Trump’s tariff announcement triggered the sell-off, with altcoins hit hardest.

Crypto markets faced a historic liquidation event this weekend, with losses potentially reaching $8 billion to $10 billion—far exceeding the $2.3 billion initially reported by tracking platforms.

Bybit founder and CEO Ben Zhou revealed the discrepancy in a Feb 3post on X(formerly Twitter), citing API limitations that obscured the full scale of the sell-off.

Bybit CEO Exposes Data Gaps: “Real Liquidations 4X Higher”

Coinglass, a crypto derivatives tracker, reported $2.3 billion in liquidations across exchanges during the trade wars market crash.

However, Zhou disclosed that Bybit alone saw $2.1 billion in liquidations within 24 hours—yet only $333 million appeared on Coinglass.

Source: ByBit CEO X
Source: ByBit CEO X

Zhou attributed the gap to API feed limits, which throttle how much data exchanges can publish per second. “Other exchanges practice the same,” he posted, suggesting industry-wide underreporting. If Bybit’s $2.1 billion represents just 25% of its actual liquidations, as Zhou implied, total market losses could exceed $10 billion.

How API Limits Masked Crypto Markets Crash

Exchanges use API (Application Programming Interface) systems to share real-time data with third-party platforms like Coinglass.

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However, these systems cap the volume of information transmitted per second. During extreme volatility, liquidations can outpace API feeds, leaving tracking platforms with incomplete data.

Bybit’s $2.1 billion liquidation event—its largest ever—exposed this flaw. Coinglass recorded only $333 million of Bybit’s losses, missing 84% of the exchange’s activity. Zhou confirmed Bybit will now “push all liquidation data” to ensure transparency.

Crypto Market’s Biggest Liquidation in History?

The Kobeissi Letter, a financial analysis firm, called the event probably the “biggest crypto liquidation in history.” The market sell-off was triggered by President Donald Trump’s February 3 announcement of tariffs on imports from China, Canada, and Mexico, which rattled global risk assets.

Altcoins took the hardest hit: Ethereum dropped 16%, reaching a low of $2,368 before recovering slightly to $2,552, yet it remains 38% below its December 17, 2024, high of $4,078.

Other major altcoins—including Avalanche, XRP, Chainlink, and Dogecoin—fell more than 20% in the last 24 hours, contributing to an 11.4% decline in the overall crypto market cap.

In contrast, Bitcoin fell to $93,00 but showed relative stability; TradingView data reveals that its market dominance increased to 61%, suggesting investors are rotating into Bitcoin as a perceived safer asset amid the turmoil.

Tariffs Paused for a Month

However, on February 3, 2025, after Mexico’s president announced a one-month tariff pause following talks with President Trump, crypto markets started rebounding.

Bitcoin rebounded, climbing 6.7% from a low of $91,530 to over $97,000 as Wall Street opened, according to TradingView. Meanwhile, altcoins fell over 20% amid tariffs on Canada and Mexico and expectations of similar measures against the EU.

Popular trader Johnny on X noted that Bitcoin’s strong support levels suggest the worst of the down move may be over, while Rekt Capital pointed to a new gap above $98,000 in CME futures acting as a short-term price magnet as BTC formed its third consecutive higher low against December and January support.

Disclaimer

The contents of this page are intended for general informational purposes and do not constitute financial, investment, or any other form of advice. Investing in or trading crypto assets carries the risk of financial loss. The forecasted data (also called “price prediction”) on this page are subject to change without notice and are not guaranteed to be accurate.

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Arnold Kirimi
Arnold Kirimi
Arnold Kirimi is a crypto and Web3 journalist from Nairobi, Kenya. With a sharp eye for emerging trends and a talent for demystifying blockchain jargon, Kirimi turns complex concepts into compelling narratives. Featured in top outlets like Cointelegraph, DailyCoin and CryptoSlate.