On Monday, crypto traders saw more than $1.5 billion in bullish bets liquidated, triggering a sharp selloff in Ether and several other coins, according to Bloomberg.

Ether briefly fell 9% to $4,075 as market participants liquidated nearly half a billion dollars in long positions in the second-largest coin, according to Coinglass data.

Bitcoin briefly fell 3% to $111,998. Coins such as Solana, Algorand, and Avalanche also fell. According to Coinglass, this was the largest wave of liquidations in the crypto market since at least March 27.

"The market appears to be in need of a breather, with some participants fearing the DAT trade (digital asset treasury) is losing steam and there are no significant inflows on the horizon," said George Mandres, senior trader at XBTO Trading.

The selloff has pushed the total digital asset market capitalization below $4 trillion, according to CoinGecko.

According to CryptoQuant, the funding rate on Ether perpetual futures has turned negative, reaching its lowest since last year's yen carry trade collapse. This indicates a predominance of short positions.

Since early July, Bitcoin has largely traded in the $110,100–$120,000 range amid low volatility. During this period, Ether and Solana have become the focus of crypto traders, gaining 74% and 52%, respectively, since the beginning of July.