Within a few hours, the price of Bitcoin dropped by over $2000, reaching levels below $41,000. This led to a significant sell-off in the market and subsequent liquidation of positions totaling over $500 million.

The cryptocurrency market experienced extensive liquidations. According to Coinglass data, in the past four hours, the total volume of liquidated positions exceeded $500 million, with $492 million being long positions and $30 million short positions.

The majority of forced position closures involved Bitcoin (BTC) and Ethereum (ETH) - $112 million and $90 million, respectively. Significant losses were also incurred by cryptocurrencies such as SOL, XRP, and LTC. The largest liquidation occurred on the OKX crypto exchange, with a long position closure amounting to $237.40 million.

The cause of this sell-off was an issued report by Matrixport, in which analysts speculated that the U.S. Securities and Exchange Commission (SEC) was unlikely to approve applications for spot Bitcoin ETFs. This contradicted the company's previous statement from January 2nd regarding the potential approval of new cryptocurrency instruments this week.

The rapid price surge occurred amid new rumors of the possible approval of SEC applications for spot Bitcoin ETFs this week and the launch of trading on the Chicago Mercantile Exchange (CME). At the time of writing this article, the asset's price stood at $41,250.