Crypto liquidations hit $1 billion after hotter-than-expected PPI inflation shock
Quick Take U.S. producer prices rose 0.9% in July, the biggest monthly gain since 2022, and 3.3% year over year, the highest level since February. More than $1 billion in crypto positions were liquidated over 24 hours, including about $782 million in longs, as bitcoin and ETH dipped on inflation results.
Bitcoin fell more than 2% while Ethereum's native token slightly fell shortly after inflation data revealed U.S. producer prices jumped more than expected in July, reviving macro worries and prompting a wave of derivatives liquidations across crypto markets.
The Producer Price Index (PPI) rose 0.9% month over month and 3.3% year over year, the fastest annual pace since February, according to data released on Thursday. Economists had looked for around 2.5% year-over-year.
CoinGlass showed more than $1 billion in positions liquidated over 24 hours, including roughly $782 million in longs. The largest single wipeout was a $6.25 million ETH/USDT position on Bybit, according to the data.
The inflation reading likely stoked concern that economic pipeline pressures could complicate the Federal Reserve’s path to easing. Even so, interest-rate futures still imply elevated odds of a September rate cut, suggesting markets view the PPI spike as a potential outlier unless confirmed by coming data. The CME FedWatch Tool tagged chances of a dovish pivot at 92%, slightly down from over 94% earlier this week.
Odds of a September Fed rate cut are at 92%. Image: CME FedWatch
Derivatives positioning remains a focal point. As The Block reported previously, open interest across altcoins has climbed to a record $47 billion , a leverage build that analysts say can amplify both rallies and drawdowns when volatility picks up.
The downbeat PPI reading arrived just days after a softer consumer-price report supported a risk-on tone. With inflation signals mixed and positioning stretched, experts expect elevated two-way volatility into next week’s jobs data and upcoming meeting from last month’s Federal Open Market Committee session.
Disclaimer: The content of this article solely reflects the author's opinion and does not represent the platform in any capacity. This article is not intended to serve as a reference for making investment decisions.
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