Bitcoin News Today: Bitcoin Near $125,000 Triggers $5.6 Billion Short Liquidation Risk

Bitcoin’s price volatility has intensified as traders brace for a potential short liquidation event that could see $5.6 billion in leveraged short positions wiped out if the asset rises above $125,000. Binance’s real-time data indicates that the bulk of these shorts are concentrated in the $121,000 to $125,000 range, a key threshold for triggering a large-scale short squeeze [2]. The risk of such a squeeze has become a focal point for traders, especially as leveraged positions on major exchanges continue to accumulate [1].

The situation has drawn significant attention from the crypto community and social media platforms, with many watching closely for signs that Bitcoin may break through the $125,000 level. Analysts have pointed out that a sustained move above that mark could create a feedback loop where rising prices trigger more liquidations, which in turn could further drive prices upward [2]. This dynamic has historically led to sharp price surges, as seen during the 2021 bull run, when similar liquidation events amplified Bitcoin’s momentum [1].

The broader market implications are also evident. A Bitcoin short squeeze could spill over into other major cryptocurrencies, including Ethereum, Solana, and BNB, amplifying market-wide volatility. Investors are increasingly adopting diversified strategies to hedge against these risks. Earlier in July, Bitcoin had already triggered $45 billion in short liquidations after surging toward $140,000, leading to $615 million in forced position closures involving Bitcoin and Ethereum [3]. However, the momentum reversed by early August as Bitcoin fell below $115,000, wiping out $700 million in long liquidations and marking a new low since mid-July [4].

Macro factors have also played a role in Bitcoin’s recent turbulence. A weak U.S. non-farm payrolls report in late July triggered a sell-off, pushing Bitcoin to $112,751 and erasing three weeks of gains [6]. Large orders have been observed on spot and perpetual futures markets, signaling further instability and attracting attention from both retail and institutional traders [7]. Prominent figures such as Arthur Hayes, co-founder of BitMEX, have taken significant steps, including selling over $13 million in crypto assets and forecasting a potential drop to $100,000 for Bitcoin and $3,000 for Ethereum [8].

The market remains in a fragile state, with leveraged positions and macroeconomic trends creating a volatile environment. As Bitcoin continues to hover near critical price levels, traders are closely monitoring whether the next move will lead to a deeper correction or another round of sharp gains driven by a large-scale short squeeze.

[1] AInvest - [https://www.ainvest.com/news/bitcoin-ethereum-prices-recover-15-billion-liquidated-48-hours-2508/](https://www.ainvest.com/news/bitcoin-ethereum-prices-recover-15-billion-liquidated-48-hours-2508/)

[2] Mitrade - [https://www.mitrade.com/insights/news/live-news/article-3-1008163-20250804](https://www.mitrade.com/insights/news/live-news/article-3-1008163-20250804)

[4] Mitrade - [https://www.mitrade.com/insights/news/live-news/article-3-1007105-20250802](https://www.mitrade.com/insights/news/live-news/article-3-1007105-20250802)

[6] ChainCatcher - [https://www.chaincatcher.com/en/article/2195006](https://www.chaincatcher.com/en/article/2195006)

[7] Blockchain News - [https://blockchain.news/flashnews/btc-price-action-alert-multi-9-figure-orders-on-spot-and-perpetuals-signal-potential-volatility](https://blockchain.news/flashnews/btc-price-action-alert-multi-9-figure-orders-on-spot-and-perpetuals-signal-potential-volatility)

[8] CryptoRank - [https://cryptorank.io/news/feed/afc0a-arthur-hayes-calls-btc-at-100k-eth-3k](https://cryptorank.io/news/feed/afc0a-arthur-hayes-calls-btc-at-100k-eth-3k)