The crypto market witnessed a powerful rebound late yesterday, fueled by renewed investor confidence and unintended signals from U.S. regulatory circles. A previously released statement from the Treasury Department in response to President Biden’s executive order on digital assets appears to have reignited market momentum. This surge carried into today’s European trading session, with most major cryptocurrencies posting strong gains—especially altcoins.
Over the past 24 hours, the total cryptocurrency market capitalization surged from $1.723 trillion to $1.852 trillion, marking a significant recovery in market sentiment. As volatility returns, traders are closely watching key resistance levels and liquidation trends across both spot and derivatives markets.
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Altcoin Momentum Builds on Strong Market Sentiment
Bitcoin led the charge, climbing approximately 24% over eight hours and challenging the critical $42,000 mark—a level not retested since last Thursday. According to CoinMarketCap, BTC briefly hit an intraday high of $42,352 before settling slightly above $42,000. This price action reinvigorated risk appetite across the board, particularly benefiting mid-cap altcoins.
Among the standout performers, Terra (LUNA) emerged as a major driver of the rally, showcasing one of the most dramatic price increases among top digital assets.
Terra (LUNA) Reaches $100 Milestone Before Pullback
Terra's native token, LUNA, experienced explosive growth over the past 24 hours. Starting from around $79, it surged to an intraday high of $99.93—an increase of 26.5%. The token briefly touched the symbolic $100 mark on several exchanges before pulling back to trade near $98.50.
This surge brought LUNA within just 103.33% of its all-time high of $119.18—an impressive recovery given its history and one of the closest approaches to that peak since early 2025.
With this momentum, Terra overtook both Solana and Cardano in market capitalization rankings, now claiming the seventh spot. Its current market cap stands at $35.785 billion, narrowly trailing XRP at $36.081 billion for sixth place.
While LUNA dominated headlines, other top altcoins also posted notable gains:
- Ethereum (ETH) reclaimed the $2,700 level after a 5.54% gain over 24 hours. Despite briefly breaking above $2,760, resistance held firm, and ETH now trades around $2,735.
- Avalanche (AVAX) rose 9.07%, currently trading just above $78.
- Polygon (MATIC) saw a more modest increase of 1.50%, dipping slightly below $4.12.
- Solana (SOL) remained under pressure despite an 88% spike earlier in the day, now hovering below $43.50.
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Over $20 Billion in Liquidations Amid Volatile Price Action
Despite the bullish momentum, extreme volatility has triggered massive liquidations across leveraged positions.
In the last 24 hours alone, total liquidations reached $20.34 billion**, affecting nearly 50 million individual trading accounts globally. Of this amount, **$135.4 million was liquidated in just the past 12 hours—highlighting intensified short squeezes and margin calls.
Short positions bore the brunt of losses, accounting for 84.61% of total liquidations as rising prices forced leveraged bearish bets to close out.
According to Coinglass data:
- Bitcoin futures led with $707.6 million in positions liquidated.
- Ethereum followed with $285.2 million in cleared long and short contracts.
- LUNA futures ranked third, with $94.9 million in liquidated volume—underscoring its growing influence in derivatives markets.
While significant, this 24-hour liquidation figure remains below the year's peak. On January 1st, nearly $1 billion in leveraged positions were wiped out in a single day during a historic market swing.
Such figures emphasize the risks—and opportunities—present in today’s high-leverage crypto environment.
Why Are Liquidations So High During Rallies?
Rapid price increases often trigger cascading liquidations, especially when traders are heavily positioned on margin. When Bitcoin or major altcoins like LUNA break key resistance levels, automated stop-loss mechanisms activate across exchanges, amplifying downward pressure once momentum stalls—even temporarily.
This dynamic explains why rallies can be both profitable and dangerous: while early movers capture gains, over-leveraged traders face sudden exits.
Frequently Asked Questions (FAQ)
Q: What caused the recent crypto market rally?
A: The rebound appears linked to renewed optimism following a Treasury Department statement related to Biden’s crypto executive order. Though not new policy, the document’s visibility boosted market confidence, particularly among institutional investors assessing regulatory clarity.
Q: Why did LUNA surge so sharply?
A: Several factors contributed: increased staking activity on Terra’s ecosystem, rumors of upcoming integrations with DeFi platforms, and strong speculative interest following months of consolidation below $80. Technical breakout patterns also attracted algorithmic traders.
Q: Are high liquidation volumes bearish for the market?
A: Not necessarily. While large liquidations signal short-term risk, they often occur during strong directional moves and can indicate accumulation phases. Historically, spikes in liquidations precede either deeper corrections or sustained breakouts—context matters.
Q: Is it safe to trade during periods of high volatility?
A: Trading during high volatility offers profit potential but increases risk—especially with leverage. Risk management strategies like position sizing, stop-loss orders, and avoiding overexposure are crucial during these times.
Q: How does LUNA compare to other top altcoins now?
A: With its recent jump in market cap and price performance, LUNA has outperformed many peers including Cardano and Solana. It now competes closely with XRP for top-five status among altcoins by valuation.
Q: Where can I track real-time liquidation data?
A: Platforms like Coinglass and exchange-built dashboards provide live updates on open interest, funding rates, and liquidation heatmaps—critical tools for active traders navigating volatile markets.
As the market stabilizes post-surge, attention turns to whether this rally has staying power or if profit-taking will trigger another wave of volatility. With Bitcoin testing $42K and altcoins like LUNA showing resilience, investor sentiment remains cautiously optimistic.
Yet amid the excitement, one truth endures: in crypto, rapid gains come hand-in-hand with amplified risk—especially when leverage is involved.
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