The crypto derivatives market just handed leveraged bulls a brutal reminder about the cost of conviction. More than $388 million in long positions were wiped out across exchanges in a single 24-hour window, a liquidation event that hit over 100,000 traders and sent a jolt through an otherwise optimistic market.

What happened and who got hurt

Liquidations occur when a trader’s margin, the collateral backing their leveraged position, falls below the exchange’s maintenance threshold. The exchange force-closes the position to prevent further losses. When $388 million in longs get liquidated, it means a lot of people were betting prices would go up, and prices did the opposite.

Bitcoin and Ethereum accounted for the…