Bitcoin News Today: Bitcoin Liquidations Hit $343M as Short Squeezes Fuel Volatility

Bitcoin Liquidations Surpass $343 Million Amid Market Volatility

Bitcoin Liquidations Surpass $343 Million Amid Market Volatility

Bitcoin liquidations reached $343 million in the last 24 hours, with short positions accounting for the largest portion of the losses. The figure represents 119,766 liquidated traders, with Hyperliquid's BTC-USD pair leading the charge with an $8.266 million liquidation. The market remains highly volatile, as traders reassess leverage and liquidity management amid sharp price swings.

The surge in liquidations came just days after a 5% rebound in Bitcoin's price, fueled by President Donald Trump's comments on the next Federal Reserve Chair. Trump's remarks, suggesting an immediate rate cut, triggered $263 million in short liquidations within four hours, according to Coinglass data. Bitcoin briefly crossed $94,000 for the first time in over a month.

However, the optimism was short-lived. Coinglass data also showed that if Bitcoin dips below $91,000, long liquidations could hit $972 million, while a rise above $94,000 may trigger $612 million in short liquidations. Traders are closely monitoring key price thresholds, with the risk of a cascade of margin calls intensifying.

How Markets Reacted

Bitcoin's recent movements reflect its increasing correlation with equities and AI stocks, a trend that has gained momentum in 2025. The cryptocurrency has closely mirrored equity markets, particularly the S&P 500 and the tech-heavy Nasdaq 100, with average correlations rising to 0.5 and 0.52, respectively, from 0.29 and 0.23 in 2024, according to Reuters. Analysts attribute this shift to broader retail and institutional adoption, as well as the speculative nature of both asset classes.

The recent volatility has also exposed growing concerns over the valuation of AI-driven stocks, which have seen significant swings amid fears of a potential bubble. Jasper De Maere, a desk strategist at Wintermute, noted that crypto's alignment with stock market sentiment has become a consistent theme in 2025. This correlation raises questions about whether crypto is losing its status as a unique asset class and becoming more sensitive to traditional market forces.

The Federal Reserve's monetary policy also plays a key role in shaping the crypto market. Fidelity research has shown that crypto tends to react to dovish signals from the Fed, and recent expectations of a 25-basis-point rate cut next week have boosted market sentiment. However, hawkish signals from earlier in the year, including Trump's tariff announcements, have left lasting scars on crypto markets, with Bitcoin struggling to regain its footing since October's crash.

What Analysts Are Watching

With the market at a critical juncture, analysts are closely watching several factors that could determine Bitcoin's near-term direction. The release of fresh economic data and the upcoming Fed rate decision are key events that could influence sentiment. Mo Shaikh of Maximum Frequency Ventures emphasized the importance of Fed policy, stating that the central bank's stance on monetary supply is a key indicator for crypto markets.

Institutional adoption remains another focal point. Exodus Movement, Inc., reported its November 2025 treasury update, showing a reduction in Bitcoin holdings amid strategic acquisitions and financing needs. Meanwhile, American Bitcoin Corp. increased its strategic reserve to 4,783 Bitcoin, signaling confidence in the long-term value of the asset. However, with short-term obligations exceeding liquid assets for some companies, there are growing concerns about the sustainability of leveraged positions.

Regulatory developments also continue to shape the landscape. The American Federation of Teachers (AFT) recently criticized a proposed crypto market bill, warning that it could expose retirement funds to "unsafe assets" and potentially lead to the next financial crisis. The debate over regulatory oversight highlights the tension between innovation and financial stability, with policymakers grappling with how to structure a framework that supports growth while minimizing risks.

Risks to the Outlook

Bitcoin's path for the remainder of 2025 remains uncertain. While the recent rebound offers a glimmer of hope, analysts warn of potential risks, including a possible "bitcoin winter," as predicted by Strategy CEO Phong Le. The growing correlation with equities and AI stocks also means that Bitcoin could be more vulnerable to broader market corrections, especially if investor sentiment turns bearish.

The CFTC's recent pilot program, which allows Bitcoin and Ethereum to be used as collateral for derivatives trades, may further tighten the link between crypto and traditional finance. While this could enhance liquidity and market depth, it also raises systemic risks, as Bitcoin's volatility now flows through institutions that underpin the broader financial system.

Meanwhile, a recent investigation by Solidus Labs revealed a Telegram-based ring that executed a $800,000 pump-and-dump scheme in just a month, highlighting the vulnerabilities of decentralized trading environments.

What This Means for Investors

Investors must remain cautious as they navigate the current volatility. For retail traders, prudent leverage management and disciplined position sizing are essential to avoid margin calls and liquidations. Institutional players, on the other hand, are advised to closely monitor regulatory developments and assess the long-term implications of increased integration with traditional financial markets.

The coming weeks will be crucial, as the Fed's rate decision and the performance of AI stocks are expected to have a significant impact on Bitcoin's trajectory. Traders are also watching key price levels, with a dip below $87,032 posing a major risk to long positions, potentially triggering $1.376 billion in liquidations.

As the market continues to evolve, the lines between crypto, equities, and traditional finance are blurring. Investors must stay informed and adapt their strategies to the changing landscape, balancing the potential for high returns with the risks of a volatile and interconnected market.