Leverage Mechanic Unleashes Carnage in Crypto Markets

A $500 million flash crash in crypto markets saw long positions liquidated at an alarming rate of $1.82 billion over 24 hours.

The disaster unfolded in under an hour, with Solana shedding 11.5% and XRP plummeting by a staggering 37%.

Excessive leverage is being blamed for the carnage, as large-cap altcoins like XRP and Solana carried a high concentration of speculative leveraged positions.

Centralized exchanges like Binance played a key role in the disaster, with their automated liquidation engines closing undercollateralized positions at the worst possible moment.