Bitcoin’s Weekend Drop Triggers $750M in Liquidations as Yen Turmoil Ripples Through Crypto

Crypto didn’t break; participation did. Bitcoin’s weekend slide exposed how thin the market has become, setting off $750 million in liquidations over 24 hours, with $579 million—about 77%—hitting leveraged longs. When price slipped from last week’s $95,400 local peak to a weekend low of $86,126 before stabilizing around $87,700 (down roughly 1% on the day), the lack of committed bid overwhelmed stretched positioning.

Here’s the core issue: futures activity has been parked in neutral for weeks. Aggregate open interest has been stuck between 245,000 and 267,000 BTC since January 8, a range-bound posture that speaks to limited conviction from both sides. At the same time, cumulative volume delta across spot and perpetuals has been grinding lower, indicating persistent net-selling pressure rather than episodic flushes. That cocktail—flat OI, negative CVD—creates a market that moves easily but not constructively.

Several desks have been saying the quiet part out loud: large buyers aren’t lifting offers at these levels. Georgii Verbitskii, the founder of TYMIO, recently framed it that way, and the tape backs it up. Without deep, price-insensitive demand, weekend order books become a minefield. A modest downtick forces de-leveraging; forced sellers push price into thinner liquidity; the cascade invites more liquidations. It’s mechanical, not mysterious.

Macro amplified the fragility. Japan’s financial stress—kicked off by a bond selloff and compounded by a yen that has been sliding since April 2024—intensified into January. Traders have been bracing for currency intervention after Prime Minister Sanae Takaichi warned about “abnormal” moves, and even rumors of the New York Fed’s involvement briefly steadied the yen. This kind of uncertainty typically pulls capital toward safety. Gold gained 2.08% and silver rose 1.6% on the day—classic defensive pivots that often coincide with crypto de-risking.

Sentiment has adjusted fast. On prediction market Myriad (owned by Dastan), the probability of a Bitcoin run to $100,000 fell 21% over the past week. Users now price a 33% chance that the next major move points toward $69,000 rather than $100,000—up sharply from 14% on January 17. Prediction markets aren’t oracles, but when they move in tandem with deteriorating CVD and stagnant OI, it reflects a broader retreat from risk rather than just noise.

What actually matters from here isn’t a headline about liquidations—it’s whether participation returns in size. Signs of stabilization would include: - OI expanding with price (not against it), suggesting fresh longs backed by spot demand rather than recycled leverage. - CVD turning positive across spot and perps, indicating real buyers absorbing supply. - Reduced basis/funding volatility, which would show that derivatives aren’t dictating the tape. - Healthier depth in weekend order books, particularly during Asia hours, where macro headlines have been setting the tone.

Until large players re-engage, rallies risk becoming drift-and-fade, while dips invite reflexive deleveraging. The market’s not broken; it’s under-attended. In that environment, macro shocks—like a skittish yen—don’t need to be dramatic to matter. They just need to arrive when the book is thin and patience is thinner.