Paper on 7 past BTC liquidation events says individual crashes are hard to predict

A paper posted on arXiv analyzed seven past large-scale Bitcoin liquidation events and found it is difficult to predict any individual crash in advance, according to CryptoSlate. The paper said no data on price, leverage, or order flow provided advance warning of the liquidation events. In six of the seven cases, lower volatility in market orders was commonly observed, but the researchers interpreted that only as a weak sign of markets turning quiet just before a sell-off and said it was insufficient as a reliable signal for predicting the timing of the next crash. On price action, five of the seven cases showed warning signs of slowing upward momentum, while the other two were triggered by sudden external events such as tariff shocks, with no such signals appearing. The paper added that while certain market patterns do recur before sharp Bitcoin declines, accurately forecasting the next liquidation-driven plunge using any single indicator remains very difficult. It also said conventional price- or leverage-based warning signals may offer little help when liquidation events are driven by unexpected external shocks such as macroeconomic news or policy announcements.