Ethereum’s rally to new highs sparked nearly $400 million in liquidations, underscoring how stretched trader positions were ahead of the move.

Data reveals that Ethereum’s breakout above $4,800 led to around $388 million in liquidations over the past 24 hours, marking the largest wipeout across all cryptocurrencies during this period.

The broader crypto market saw $769 million liquidated, forcing more than 183,000 traders out of their positions. Notably, the biggest single loss was a $10 million ETH swap on OKX—an unusually large amount for Ethereum, which typically trails Bitcoin in leveraged positions.

Liquidations highlight the fragile nature of crypto market positioning. When traders use high leverage and the market moves against them, exchanges automatically close those bets to limit further losses.

A wave of long liquidations often clears the path for a healthier rebound, while significant short liquidations can accelerate upward momentum.

This liquidation event coincided with Ether’s nearly 15% surge to a record $4,885 after Federal Reserve Chair Jerome Powell hinted at potential rate cuts in September. Bitcoin’s gain was more modest at 4%, reaching $113,000, while the CoinDesk 20 Index rose 9%.

Analysts note that this rally isn’t driven solely by macroeconomic factors. Institutional buying and corporate treasury allocations are providing additional support, fueling speculation that Ethereum could emerge as Wall Street’s blockchain of choice.

“Ether’s new all-time high signals growing investor demand beyond Bitcoin,” said Samir Kerbage, CIO at Hashdex, in a statement to CoinDesk. “I expect ETH to surpass $10,000 once stablecoin payment solutions begin rolling out in the U.S.”

Once considered a lofty goal, the $10,000 price target is gaining traction as Ethereum solidifies its role as the foundation for stablecoins, tokenization, and smart contract platforms. Year-to-date, ETH has climbed approximately 45%.