Meme Insider
In the fast-paced world of cryptocurrency trading, liquidations can make or break fortunes overnight. If you're into meme tokens, you know how volatile things can get—leverage amplifies gains but also crushes positions when the market turns. Recently, prominent trader Ansem (@blknoiz06) shared a concise yet insightful take on X about the two main types of large long liquidations in crypto. Let's break it down and see what it means for the current market, especially for those chasing the next big meme coin pump.
Ansem pointed out:
two types of large long liquidations in crypto
• liquidations in a bull market that clear out leverage & spot buyers come in to V-reverse everything in a matter of weeks to new highs (jan 11, 2021)
• liquidations that signal buyer exhuastion & end of a trend (dec 4, 2021)
For the uninitiated, a "long liquidation" happens when traders betting on price increases (long positions) get forced out because the price drops too much, often due to leveraged trading on platforms like Binance or Bybit. The "V-reverse" refers to a sharp V-shaped recovery, where prices bounce back quickly to new highs.
Ansem references historical Bitcoin events: January 11, 2021, saw a massive liquidation during a bull run, but it was just a shakeout—leverage got cleared, and spot buyers (those buying actual crypto without borrow) stepped in, pushing BTC to new peaks shortly after. On the flip side, December 4, 2021, marked buyer exhaustion, signaling the end of the 2021 bull trend and the start of a prolonged bear market.
Why does this matter for meme tokens? Meme coins like those on Solana—think Dogwifhat or Bonk—are often heavily leveraged plays. In a bull market liquidation like the first type, it could be a buying opportunity, as fresh capital floods in and reverses the dip. But if it's the second type, it might mean the party's over, and your favorite meme could fade into obscurity.
The post sparked lively discussion in the replies. For instance, @0xPajke questioned the idea of buyer exhaustion, arguing that cheap capital from upcoming rate cuts could fuel more buying:
what reason is there to believe dat buyer exhaustion?
capital is so cheap now and gonna get cheaper over next few months
they can easily raise more money and debt to buy junk
To back this up, they shared charts showing declining volatility in traditional markets:
This is the VIX, often called the "fear index" for stocks, spiking then calming—suggesting markets aren't panicking.
The MOVE index for bond volatility follows a similar pattern, indicating stabilizing fixed-income markets.
And high-yield bond spreads are tightening, meaning investors are comfortable with risk again.
Other replies ranged from bullish optimism, like @0xPoundSterling predicting new BTC all-time highs in October and November, to skeptical takes. One user, @grimacexbt, warned against applying 2021 lessons to 2025's choppy range-bound market.
As a meme token enthusiast, keep an eye on these signals. If we're in a bull reset, load up on undervalued memes during the dip. But if exhaustion sets in, it might be time to derisk. Ansem's post reminds us that not all liquidations are created equal—context is key in this game.
Stay tuned to Meme Insider for more breakdowns on how macro events impact your favorite blockchain plays. What's your take on the current liquidation wave? Drop a comment below!
