MarketsBitcoin
|5 min ReadBitcoin crashes 5% as Sunday leverage washout hits the market
Jax Morales
Senior Analyst
Published
Jan 16, 2026
Alpha Briefing: Bitcoin dropped nearly 5% to 539 million in mostly long liquidations and wiping out over 180,000 traders. The drop capped a brutal November, with BTC down 17.49% for its worst November performance since 2018, yet key analysts still frame the move as a structural flush, not a fundamental breakdown.
Bitcoin’s quiet weekend ended with a violent jolt. After spending most of the weekend grinding around 86,950 on Coinbase, according to Tradingview. It was a classic “Sunday slam” that many in crypto have seen before, only this one came right after Bitcoin finally printed its first green weekly candle in a month.
BTC dumps $4,500 in Sunday slaughter. Source: TradingView
The weekly close itself looked fine. Bitcoin ended the week at 4,500 air pocket lower that caught many weekend traders leaning the wrong way.
Weekend calm breaks as selling volume spikes
All weekend, BTC looked like it wanted to consolidate into the end of the month. Price hugged the $91,500 zone, trading in a tight range that gave bulls hope for a clean start to the new month and bears fear of another squeeze. That calm did not last.
In just three hours on Sunday, price slid almost 5% to $86,950 on Coinbase. As the Kobeissi Letter pointed out, this pattern has played out again and again in 2025. “As seen countless times this year, Friday night and Sunday night often come with large crypto moves,” it observed, adding that this particular slump arrived without any obvious news catalyst.
Instead of headlines, it was the order book that told the story. Kobeissi blamed the flash crash on a sudden wall of selling that hit a leveraged market hard. A “sudden rush of selling volume” triggered what it described as a domino effect sell off, amplified by “historic amounts of levered positions being liquidated.” In other words, the market structure did the damage, not some new fundamental shock.
Leverage liquidated as long traders take the hit
The numbers behind the move were brutal. Over 180,000 traders were liquidated in the past 24 hours, according to CoinGlass. Total liquidations reached $539 million, and most of that pain landed in the final few hours of the Sunday move.
Almost 90% of those liquidations were long positions. The majority were in Bitcoin and Ether, which is exactly what you expect when traders chase upside into thin weekend liquidity with high leverage. When the floor gives way, the cascade is fast and unforgiving. It is a familiar pattern in crypto, but that does not make it any less costly for those on the wrong side.
Kobeissi was clear that it still views this environment as a structural bear market, even if the headlines shout about every bounce and breakdown. “This crypto ‘bear market’ is still structural in nature. We do NOT view this a fundamental decline,” it said. The message is simple. The market is repricing positions and leverage, not rewriting the entire Bitcoin story.
Worst November since 2018, yet some see a “great start”
The Sunday slam capped a very rough month for Bitcoin. BTC logged its worst month of the year and its worst November performance since 2018. According to CoinGlass, Bitcoin ended November down 17.49%. For comparison, November 2018 was much uglier, with the asset falling 36.57% during a brutal bear market leg lower.
Yet even in this kind of tape, not everyone is bearish. Analyst “Sykodelic” stayed upbeat, stating, “This is actually a great start to the month.” The logic is that a clean flush can set the stage for healthier price action later.
Sykodelic noted that there was no Sunday pump this time and that the major Chicago Mercantile Exchange gap had already been closed. On top of that, around $400 million in longs had already been wiped out. In his view, having “downside liquidity swiped first” is exactly what bulls should want to see. It means the market has cleared out weak hands, reduced leverage, and reset the board for the next move.
In short, Bitcoin just delivered another harsh reminder of what weekend leverage can do. Price dropped nearly 5%, hundreds of thousands of traders were liquidated, and November closed as the worst since 2018. Yet key voices still frame this as a structural shakeout, not a fatal blow, with some even calling it a “great start” to what comes next.
Disclaimer: This document is intended for informational and entertainment purposes only. The views expressed in this document are not, and should not be taken as, investment advice or recommendations. Recipients should do their own due diligence, taking into account their specific financial circumstances, investment objectives and risk tolerance, which are not considered here, before investing. This document is not an offer, or the solicitation of an offer, to buy or sell any of the assets mentioned.