$803 Million in Crypto Positions Liquidated as Asian Chip Stocks Slide
Key Facts
Liquidations of leveraged positions in the cryptocurrency market totaled about $803 million over 24 hours, according to CoinDesk, coinciding with a selloff in Asian chip stocks. Long positions accounted for 86% of the total, concentrating forced closures in bets on rising prices. Liquidations in the latest phase of the selloff totaled about $595 million, according to the same report. The largest single liquidation was a $9.65 million bitcoin long position on Binance. The wave swept across cryptocurrencies and perpetual contracts linked to the semiconductor sector, leaving affected trading accounts exposed to both digital assets and bets on the prices of equity-linked instruments.
Bitcoin topped the ranking of assets by the value of liquidated positions, with a total of $181 million, according to CoinDesk. Ether followed closely, with $178 million in liquidations, also placing it among the largest sources of losses for leveraged traders. Among chip-linked instruments, liquidations of contracts tracking the SOXL fund totaled about $7.21 million. The fund seeks daily investment results, before fees and expenses, equal to 300% of its index's daily performance, according to Direxion's prospectus filed with the U.S. Securities and Exchange Commission. The positions liquidated on cryptocurrency platforms were perpetual contracts tracking the fund, rather than holdings of its shares.
In Asian equity markets, SK Hynix fell 8.9% and Samsung Electronics dropped 8% during trading, according to the snapshot reported by Investing.com. The selloff spread to Japan, where memory chipmaker Kioxia fell 13% in a trading snapshot reported by Reuters, leading declines among AI-linked stocks in Tokyo. U.S. memory stocks had come under pressure in the previous session, with Micron falling 3.9%, according to Bloomberg. The Korean market's losses came amid net foreign selling exceeding $6 billion from the start of the month through Bloomberg's report. The outflows coincided with investors' reaction to developments in Chinese competition in the memory industry.
Bloomberg, in a report carried by Moneycontrol, said investors reacted to news of progress by China's CXMT on a new memory chip architecture. Samsung and SK Hynix are also working on this architecture, putting the Chinese development at the center of competition with the two Korean companies. Comments by Broadcom's chief executive added to investor concerns about AI stocks, according to the report. The chief executive likened investment in these stocks to "gambling" in comments addressing the nature of bets on the sector. Concerns over competition in memory chips accompanied this unease over AI investment during the technology stock selloff.
Equity perpetual contracts allow traders to gain exposure to share price movements without having to own the underlying asset, according to Binance Academy. The platform says these contracts trade around the clock, seven days a week, and are settled in USDT. The maximum stated leverage for these products is 10 times, according to their published specifications. Liquidation occurs when a trader's collateral balance falls below the maintenance margin level, prompting the platform to close the position automatically. Liquidation thresholds and unrealized profits and losses depend on the contract's fair reference price, according to Binance's explanation of perpetual contracts, rather than the price of the last trade executed in the market.
As bitcoin subsequently recovered, the direction of liquidations reversed, shifting pressure to short positions, according to CoinDesk. Short positions liquidated in the latest recovery window totaled $59 million. Those positions accounted for 79% of the latest liquidations, after long positions had borne the brunt of the downturn. On the U.S. data calendar following the session covered by the report, the September Consumer Price Index release was scheduled for Wednesday, October 14, 2026, according to the U.S. Bureau of Labor Statistics. The official schedule set the inflation data release for 08:30 a.m. U.S. Eastern Time.