Every sharp red day produces the question: is crypto crashing? There is no official definition, but a simple test separates a crash from a pullback.

The three-part test

  1. Size. A fall of more than 15 percent in Bitcoin within a day or two is a crash by most traders’ standards. Smaller moves are corrections.
  2. Breadth. In a crash, nearly every large coin falls together and stablecoin exchange rates can wobble.
  3. Forced selling. Liquidation totals reach billions of dollars in a day, and exchanges post record volume.

What to do while it happens

Avoid panic selling into the lowest-liquidity hours, avoid adding leverage, and check whether your exchange is showing delays. Read the cause first: our guide Why Is Crypto Down Today? covers every usual cause.

Crashes that were not crashes

Many headlines call a 5 percent day a crash. Check the size before reacting.

How crashes have unfolded before

Past crashes share a shape. A trigger arrives, such as a failed company, a rate shock or a hack. Leveraged positions are forced shut, which deepens the fall, and then selling pauses once the forced orders run out. The pause is often the low, but it only shows up after the fact.

Signs the worst may be over

Liquidation totals fall back toward normal, funding turns negative, and price stops making lower lows on rising volume. None of these is a guarantee, but together they point to forced selling ending.

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Questions readers ask

How long do crypto crashes last?

Sharp crashes often bottom within days, but recoveries can take months. Past recoveries are no guarantee.