Ethereum News Today: Ethereum Surges Trigger $40M Short Liquidation Amid $4,500 Resistance Test

A $40 million surge in Ethereum short liquidations on August 13, 2025, highlighted the cryptocurrency’s increased volatility and signaled potential resistance testing near the $4,500 level. The rapid price movement forced traders to cover short positions, triggering a cascade of buy orders that further intensified upward momentum. This event marked one of the largest liquidation events in recent weeks and reflected the heightened leverage and institutional activity in the market [1].

According to on-chain data, the liquidation occurred as Ethereum prices surged unexpectedly, catching short sellers off guard and initiating a short squeeze. Analysts observed that the sudden shift in market sentiment led to a self-reinforcing cycle where rising prices triggered more liquidations, which in turn pushed prices higher. This dynamic is common in leveraged markets, particularly when traders overextend their short positions during bullish reversals [2].

The surge in Ethereum was not isolated. In July, the cryptocurrency had already surpassed the $4,500 level, supported by large-volume trades and institutional accumulation. One notable holder, 180 Life Sciences, disclosed Ethereum holdings of 82,186 ETH, valued at approximately $349 million, with no immediate plans for divestment. This institutional interest reinforced the notion that Ethereum was entering a period of sustained accumulation [3].

Despite the bullish signs, the market remained vulnerable to sharp corrections. High leverage levels, coupled with inflows into exchanges and the testing of key resistance levels, increased the risk of sudden reversals. A report from PANews noted that the liquidation event served as a warning of the fragile equilibrium in the current market structure, where a single shift in sentiment could trigger a chain reaction [4].

The Ethereum liquidation occurred against a broader backdrop of uncertainty in the crypto market. Just days earlier, Terraform Labs co-founder Do Kwon had pleaded guilty to fraud charges, intensifying regulatory scrutiny and investor caution. While Ethereum was not directly impacted by the Terra collapse, the broader market anxiety influenced trading behavior and liquidity dynamics [5].

From a technical perspective, the liquidation event was seen as a critical test of Ethereum’s price resilience. The asset had shown strength in defending key support levels, and its ability to maintain momentum amid large-scale liquidations would be a key indicator of its readiness for a sustained bullish phase. Analysts emphasized that the next few weeks would be crucial in determining whether Ethereum could consolidate gains or face renewed bearish pressure as it approaches $5,000 [2].

Sources:

[1] ETH trades above $4500 amid Ethereum treasury buying — CoinGlass (https://www.coinglass.com/ru/news/532272)

[2] Top Cryptocurrency News Today | Binance Square — Binance (https://www.binance.com/en-KZ/square/news/all)

[3] a whale/institution once again increases its holdings of ... — PANews (https://www.panewslab.com/en/articles/b02e2550-8991-4a24-9479-f22fac45c69e)

[4] 180 Life Sciences Boosts Ethereum Investments — Economic Times (https://m.economictimes.com/crypto-news-today-live-12-aug-2025/liveblog/123243763.cms)

[5] The Daily: Terraform Labs co-founder Do Kwon pleads ... — CoinGlass (https://www.coinglass.com/ru/news/532245)