On Tuesday, cryptocurrency traders experienced the largest liquidation of leveraged long positions in three months as the rally in the digital asset prices, fueled by ETFs, reversed sharply lower.

Over the past 24 hours, 76,376 traders faced liquidation, resulting in a total liquidated amount of $307.67 million. This marks a significant single-day decline since August 17.

The day unfolded with Bitcoin plummeting by 4% to $35,000 despite a generally positive atmosphere for risk assets following a lower-than-expected October inflation report, which significantly boosted stocks and slashed bond yields. This downward trend wasn’t limited to Bitcoin; Ether  also mirrored the decline, dropping by 6% and falling below $2,000.

This sudden downturn contrasts sharply with the trend of recent weeks, which ha been characterized by “short squeezes” driven by rising asset prices that triggered the liquidation of leveraged bets against lower prices.

Liquidations occur when an exchange is compelled to close a leveraged trading position due to trader’s margin or initial investment begin partially or completely lost. These cascading liquidations can worsen price volatility as traders scramble to cover their positions, removing excessive leverage from the market.

The substantial amount of liquidations suggests that the abrupt price decline caught many investors off-guard, with data showing 76,667 traders facing liquidation. Bitcoin traders took the hardest hit, facing $133 million in liquidations, followed by ETH traders at around $70 million.

In a recent report, JPMorgan analysts cautioned that the surge in cryptocurrency prices might have been overstretched, cautioning against excessive optimism regarding the impact of the potential approval of spot BTC exchange-traded fund on asset prices.