CoinDesk
Nearly $51.6 million in leveraged positions tied to chip stocks and semiconductor funds were force-closed in a 10-minute flush on Saturday, even as U.S. markets were shut. About $38 million came from traders betting on higher prices. The contracts trade around the clock on crypto exchanges, leaving weekend prices driven by crypto-market flows rather than live share quotes.
Why it matters
The liquidation wave began on Binance and spread to Hyperliquid in seconds. David Jeong, chief executive of trading firm Tread.fi, said the first large SanDisk and Micron sell orders appeared on Binance at 21:21:59 UTC. Roughly 10 addresses then opened bearish positions across six chip-linked contracts on Hyperliquid within 1.8 seconds.
Leverage amplified the move. Traders who borrow to increase exposure are automatically closed out when losses consume their deposits, and those forced sales can push prices lower for subsequent positions. Binance handled about $21.9 million of SanDisk trading in the first minute, compared with $3.1 million on Trade XYZ.
Market impact
SOXL, a fund designed to deliver three times the daily move in chip shares, recorded about $12.7 million in liquidations. SanDisk and SK Hynix contracts followed at roughly $10.8 million each. Memory-chip shares were already coming off a difficult week as investors weighed competition from Chinese chipmaker CXMT.
With the stock market closed, the contracts had no live share price to anchor them. Trade XYZ rules allow platform trading to set reference prices until outside quotes return. U.S. market reopening on Monday will show how far the weekend prices diverged from underlying shares and whether the forced selling was a crypto-market dislocation or an early signal for chip stocks.
Frequently asked questions
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How much was liquidated in the chip-stock contracts?
About $51.6 million in positions tied to chip stocks and semiconductor funds were force-closed over 10 minutes. Roughly $38 million came from traders betting on higher prices.
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Which chip-linked contracts took the largest losses?
SOXL recorded about $12.7 million in liquidations. SanDisk and SK Hynix contracts followed at roughly $10.8 million each.
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How did the liquidation cascade spread across exchanges?
The selling began on Binance and reached Hyperliquid within seconds. Roughly 10 addresses opened bearish positions across six chip-linked contracts within 1.8 seconds.
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Why were weekend prices especially vulnerable to a cascade?
The perpetual futures traded while U.S. markets were closed, so no live share prices anchored them. Forced selling pushed traders to react to one another.
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What will Monday's market reopening reveal?
Live U.S. share quotes will show how far the weekend contract prices diverged from the underlying stocks and whether the move reflected a liquidation cascade or broader chip-stock weakness.
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