Bitcoin Rally Catches Shorts Offside—$200M Liquidated As Price Hits $79,000

Looks like BTC has led the liquidations | Source: CoinGlass

It would appear that Bitcoin has been the number one contributor of liquidations in the market like usual, with more than $222 million in positions related to the asset getting flushed during the past day. About $205 million of these positions were short ones, meaning that bearish bets made up for an extreme majority of the liquidations.

Shorts being the most heavily affected side is naturally down to the fact that the cryptocurrency has seen a sharp surge inside this window. Ethereum, which has seen the second-largest derivatives flush, also saw the shorts make up for $99 million of its $115 million in total liquidations.

In total, the digital asset sector as a whole has witnessed nearly $449 million in liquidations over the last 24 hours.

The latest numbers related to the total market liquidations | Source: CoinGlass

From the table, it’s apparent that $365 million or over 80% of these liquidations involved short positions, reinforcing the bullish wave that the sector as a whole has seen in this period.

A mass liquidation event like today’s is popularly known as a squeeze. Since the latest event has involved mostly shorts, it would be called a short squeeze. Generally, these events kickstart after a sharp swing in the price unleashes an initial wave of liquidations. This flush then feeds back into the move, which causes even more liquidations in the market.

In the cryptocurrency sector, these events aren’t exactly a rare sight due to the volatility that coins tend to see on the regular and leverage use being widespread among derivatives traders.

Featured image from Dall-E, chart from TradingView.com