Sharp market swings have once again wiped out millions of dollars in leveraged bullish positions, highlighting the risks traders face when using borrowed exposure.
Bitcoin (BTC) experienced significant volatility over the past several hours, moving sharply in both directions and catching leveraged traders off guard.
The turbulence followed two developments that unsettled financial markets. Nvidia CEO Jensen Huang, whose company is a major player in the artificial intelligence industry and the world’s largest company by market capitalization, reportedly acknowledged an affair with a woman U.S. authorities suspect of spying for China. Meanwhile, U.S. Secretary of State Marco Rubio revealed that negotiations with Iran had reached an impasse.
With traditional financial markets closed over the weekend, cryptocurrencies were among the first assets to react to the developments, initially facing selling pressure as investors shifted toward safer positions.
Bitcoin and Ether Experience Sharp Swings
Bitcoin dropped to approximately $73,761 late Sunday, marking its lowest level since August, before recovering above $75,000, according to CoinDesk data.
Ether (ETH), the second-largest cryptocurrency by market capitalization, also experienced a steep decline, briefly falling below $2,100 before rebounding to around $2,144 at the time of writing.
The sudden price movements triggered widespread liquidations across leveraged cryptocurrency futures markets.
Data from CoinGlass showed that more than $1 billion worth of crypto positions were forcibly closed over a 24-hour period, with the majority occurring during the final six hours.
Bullish traders suffered the heaviest losses. Long positions, which profit when prices increase, accounted for approximately $913 million of total liquidations, indicating that traders betting on a market recovery were hit particularly hard.
Ether recorded substantially higher liquidations than Bitcoin. Approximately $448 million in ETH positions were wiped out, compared with $272 million in BTC liquidations. The largest individual liquidation was also tied to Ether, involving a position valued at $48 million.
Nvidia Investigation Raises Concerns Across Markets
Nvidia’s board has reportedly initiated an independent investigation following allegations that CEO Jensen Huang had a relationship with Alice Huang, a business executive suspected by U.S. intelligence agencies of sharing information with Beijing.
Jensen Huang acknowledged being unfaithful to his wife in a message to employees, expressing regret and apologizing for the damage caused.
Nvidia stated that it had no evidence suggesting that company secrets or national security information had been compromised. However, the board said its investigation would review all relevant information with assistance from independent external legal counsel.
The controversy extends beyond Huang’s personal life because Nvidia occupies a central position in the global AI industry. The company’s growth has helped fuel investor enthusiasm for artificial intelligence, encouraging risk-taking across financial markets, including cryptocurrencies.
Nvidia is also a key player in the technological rivalry between Washington and Beijing.
The U.S. government has imposed restrictions on exports of Nvidia’s most advanced AI processors to China. At the same time, Megaspeed, a company reportedly connected to Alice Huang, has faced allegations of helping restricted Chinese businesses gain access to Nvidia chips.
Crypto-based tokenized equities have already shown signs of concern over the developments.
NVDAX, a tokenized representation of Nvidia shares traded on the xStock platform, declined 3.55% over 24 hours to approximately $180.42.
By comparison, Nvidia shares closed Friday’s Nasdaq session at $186.64. The difference suggests that cryptocurrency traders may be pricing in additional downside ahead of the traditional stock market’s reopening on Monday.
Concerns about the sustainability of the AI investment boom have also been growing. The Nasdaq Composite, which is heavily weighted toward technology companies, dropped nearly 5% last week, extending its losing streak to four consecutive weeks.
Iran Negotiations Add to Market Uncertainty
Geopolitical concerns provided another source of pressure after U.S. Secretary of State Marco Rubio criticized Iran’s negotiating demands as “outrageous” and indicated that discussions had failed to produce meaningful progress.
The stalled negotiations have increased uncertainty surrounding the Middle East.
For cryptocurrency markets, renewed regional tensions are particularly important because geopolitical instability can drive oil prices higher and encourage investors to reduce exposure to riskier assets.
Despite Bitcoin’s reputation as digital gold, its performance since the Iran conflict began in March has more frequently reflected weakness during periods of rising oil prices rather than the traditional safe-haven behavior associated with gold.
Bitcoin Faces Key Technical Levels
Bitcoin’s recovery above $75,000 initially offered some relief to bullish traders. However, the rebound had begun losing momentum at the time of writing, according to CoinDesk data.
The next significant move could depend heavily on how traditional financial markets respond when trading resumes Monday, particularly to developments surrounding Nvidia and the stalled U.S.-Iran negotiations.
From a technical perspective, Bitcoin is currently trading within a narrow range defined by two important moving averages.
The 200-day moving average provides support near $73,150, while the 100-day moving average represents resistance around $77,430.
A sustained move below the 200-day average could expose Bitcoin to further downside, while a recovery above the 100-day average would strengthen the case for a broader rebound.
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