Crypto enters Q3 with thinner liquidity and less leverage after $8.35B liquidation

Key Facts

1Bitcoin and Ether open interest fell sharply after $8.35 billion in long liquidations.

After a turbulent Q2 that saw $8.35 billion in long liquidations, crypto enters Q3 with thinner liquidity and reduced leverage. According to Cointelegraph reports, open interest in Bitcoin and Ether dropped sharply following the liquidations, signaling a retreat in high-leverage speculation.

Talos analysis indicates that lower liquidity could amplify volatility, but the reduced leverage lowers the risk of cascading liquidations. Per market data, Bitcoin trades near $61,000 and Ether around $3,400, with market depth notably shallower compared to Q1.

Traders are eyeing upcoming U.S. inflation data, especially yesterday's Core PCE at 0.3% month-on-month, and the Fed's next policy moves. With thin liquidity, any data surprise could trigger outsized moves, though lower leverage should limit crash severity.