How crypto derivatives liquidation drove Bitcoin’s 2025 crash
Forced liquidations in the crypto derivatives market reached about $150 billion in 2025, according to CoinGlass data.
On its face, the figure looks like a year of persistent crisis. For many retail traders, watching price feeds turn red became shorthand for chaos. In practice, it captured something more mundane and structural: the notional value of futures and perpetual positions that exchanges forcibly closed when margin fell short.
Most of the time, that flow was more of a maintenance function than a crash. In a market where derivatives rather than spot markets set the marginal price, liquidations operated like a recurring levy on leverage.
Taken in isolation, the number looked alarming. However, set against the backdrop of 2025’s…
