Dogecoin Bulls See $60M Liquidations in Biggest Hit Since 2021

Bullish bets on dogecoin (DOGE) futures fared worse than their bitcoin (BTC) counterparts on Monday, unusually, as a slide in the dog-themed meme token liquidated $60 million in long trades.

The DOGE price slumped more than 10%, before briefly recovering amid a sell-off in major tokens and bitcoin in Asian trading hours. The CoinDesk 20 Index (CD20), a measure of the broader crypto market, has dropped 3.4% in the past 24 hours.

BTC long bets lost $47 million in the same period. Ether (ETH) bullish bets lost the most, however, at $76 million. Overall, crypto longs lost over $440 million as profit-taking and dollar strength weighed on the market, traders said Tuesday.

"The meme coin market has experienced a general pullback this month as bitcoin prices face pressure," said Lucy Hu, a senior analyst at Metalpha. "The expectation of one rate cut by the Fed has prompted investors to divert from risky assets to less risky ones, and DOGE may suffer as one of the largest meme coins on the market."

Coinanlyze data shows that almost all the DOGE liquidation activity in the past 24 hours came from longs, or bets on higher prices. Only about $600,000 worth of shorts, or bets against the token, were liquidated.

The figures are the highest for DOGE futures since May 2021, the data shows. Over $44 million of the liquidations occurred on Huobi, a crypto exchange popular with Asia-based traders.

Open interest, or the number of unsettled futures bets, has dropped 16% to $600 million. Meanwhile, a long-short ratio tracking DOGE futures shows traders are positioning for further declines with the ratio at 0.94 – indicating a bearish bias.

Liquidation refers to when an exchange forcefully closes a trader's leveraged position due to a partial or total loss of the trader's initial margin. It happens when a trader is unable to meet the margin requirements for a leveraged position, that is they don't have enough funds to keep the trade open.