Bitcoin Surge Wipes Out $1 Billion in Shorts, 232,149 Traders Impacted

Bitcoin's recent surge to new all-time highs has led to a significant liquidation of short positions, with over $1 billion in crypto shorts wiped out within a 24-hour period on Thursday. This event impacted 232,149 traders, with the majority of liquidations occurring in Bitcoin (BTC) and Ether (ETH). Approximately $570 million in Bitcoin shorts and $206.93 million in Ether shorts were liquidated, while Bitcoin liquidations totaled $590.04 million, with only $20.21 million being long positions.

The liquidation event was triggered by Bitcoin's consecutive record highs, reaching $112,000 on Wednesday and $116,500 on Thursday. Ether also surged to $2,990 on Thursday, contributing to the overall market capitalization spike of 4.4% to $3.63 trillion. The Crypto Fear & Greed Index remained steady at a "Greed" score of 71 out of 100, indicating a bullish sentiment despite the recent liquidations.

Crypto analysts and traders responded to the event with a mix of surprise and excitement. Miles Deutscher, a crypto analyst, described the situation as "Bears in disbelief," while Daan Crypto Trades referred to it as a "MASSIVE Short squeeze on BTC & ETH." Velo noted the significant liquidation event, stating that "Lots of emails are being sent," highlighting the impact on traders.

This liquidation event, while significant, was not the largest in recent history. A previous event on Feb. 3 resulted in over $2.24 billion liquidated amid concerns of a global trade war. Earlier in the week, analysts were divided over Bitcoin's potential to reach new highs. Bitfinex analysts expressed skepticism, noting a "lack of follow-through strength" in Bitcoin traders. However, Michael van de Poppe, founder of MN Trading Capital, predicted an "inevitable breakout to an ATH on Bitcoin" during the upcoming week.

Despite the liquidations, traders are now betting on the price remaining stable or rising further. Approximately $2.11 billion in long positions are at risk of liquidation if Bitcoin retraces to Wednesday’s price of $112,000. The event underscores the volatility and unpredictability of the cryptocurrency market, where significant price movements can lead to substantial liquidations and shifts in market sentiment.