3 Altcoins with a High Risk of Liquidation in the Second Week of August

As the second week of August begins, the total market capitalization of the crypto market has surpassed the $4 trillion mark, officially setting a new record high. With improved trading sentiment, bullish expectations further deepen the imbalance between buy and sell positions. Therefore, some altcoins may face significant liquidation this week if prices move contrary to the expectations of short term leveraged traders.

1. Ethereum The 7-day liquidation chart of Ethereum shows a significant imbalance between the accumulated liquidation volume on both the buy and sell sides. Traders continue to allocate capital and leverage to bet that ETH will continue to be bullish after breaking through the $4,300 level. Coinglass data shows that long positions could lose more than 5 billion dollars if ETH drops 7% this week and falls below 4,000 dollars. Conversely, if the price of ETH rises 7% to 4,600 dollars, there will be 2 billion dollars in liquidation due to short sell orders.

Some traders are concerned that the flow of funds is primarily going into ETH, while other altcoins are not receiving similar inflows. They believe that the bullish momentum of ETH may lack sustainability if buying pressure gradually decreases, potentially leading to a sharp decline and liquidation of up to 7 billion dollars. Investor Marzell stated: "If Ethereum drops to $3,600, over $7 billion in long positions will be liquidated - an extremely attractive source of liquidity for exchanges… As liquidity primarily flows into ETH while other altcoins remain inactive, this indicates that ETH may be positioning itself to balance the crypto market capitalization in response to potential dominance moves by Bitcoin." 2. Ethena Ethena (ENA) is one of the most talked-about altcoins in August. Thanks to the GENIUS Act passed on July 18, Ethena's stablecoin USDE reached a market capitalization of $10 billion, becoming the third largest stablecoin after USDT and USDC. The bullish sentiment for ENA has surged, pushing the price from $0.50 to over $0.80 in August. A recent report from BeInCrypto shows that whale investors are still accumulating ENA, and the liquidation chart reflects traders' expectations for the next short term profits. The 7-day liquidation map of ENA shows that the total accumulated liquidation volume of long-term buyers far exceeds that of short sellers.

If ENA drops to the psychological support level of $0.70 this week, buy orders could incur losses of over $70 million. On the other hand, if ENA rises to $0.90, sell orders would only lose $16.5 million. Some traders believe that ENA could continue to rise to the level of 1.50 dollars. However, they warn that this token may face profit-taking pressure in the range of 0.80–0.90 dollars. 3. XRP While many altcoins show an imbalance on the liquidation map in the bullish direction from short term traders, XRP presents a different picture. A recent report from BeInCrypto indicates that Ripple has unlocked 1 billion XRP, raising concerns about bearish pressure. Technical signals also suggest that sellers may soon take control. It may be for these reasons that the 7-day liquidation map of XRP shows traders are putting more money into the bearish scenario.

If XRP moves against this bearish trend, short sellers may incur heavy losses this week. Specifically, if XRP increases by 8% to $3.50, nearly $500 million in short sell orders will be liquidated. Conversely, if XRP decreases by 8% to $3.00, buy orders will face approximately $370 million in liquidation.