Ethereum News Today: Ethereum Surpasses $4,000 Sparking $119M Short Liquidations

Ethereum (ETH) surged above $4,000 for the first time since December 2024, marking a significant milestone in the ongoing bullish momentum of the cryptocurrency. The price breakthrough triggered a wave of short liquidations, with over $24 million wiped out in just one hour on derivative platforms [1]. Over the past 24 hours, cumulative short liquidations reached $119 million, reflecting a dramatic shift in position dynamics as traders scrambled to cut losses [2].

The price action was driven by a combination of heightened on-chain activity and speculative interest. Open interest for ETH derivatives rose to $26.65 billion, nearing a three-year high, with an increase of approximately 6.8% over the last 24 hours [3]. Long positions have accumulated above the $3,850 level, indicating growing confidence among bullish investors.

The price surge came after a prolonged period of consolidation, with ETH rising over 62% in the past three months. The most notable upward momentum began in July, pushing ETH to $4,001.13 on Gate.io and briefly breaching $4,012 on Binance [4]. On Hyperliquid, the imbalance between long and short positions became evident, with 29,307 long positions against only 14,332 short positions [5]. The largest ETH short position, valued at $339.16 million, faced losses of over $35 million during the recent price movement.

The move above $4,000 marked a turning point in market sentiment. Over 95% of ETH traders are now in profit, with limited selling pressure observed. Institutional and whale activity has also been a key driver, as large holders repositioned with a lower cost basis following a low of $1,400 earlier this year [6]. With most on-chain holders in profit, the rally has rekindled optimism for a broader expansion in altcoins.

Ethereum’s dominance in the cryptocurrency market has also increased to 12.1%, reinforcing expectations of an “altcoin season” [7]. The current rally has also brought the total value locked (TVL) in Ethereum-based DeFi protocols back to levels last seen in early 2022, with TVL surpassing $86 billion [8]. The rise in TVL is driven by increased demand for lending, with liquidatable positions as low as $997 per ETH. This trend has also led to stronger demand for ETH, as more tokens are being staked or wrapped, reducing supply in the open market [9].

Despite the rapid rise, analysts note that ETH still needs to break through the $4,000 resistance level to attempt a new all-time high. Short-term price predictions of $5,000 have been mentioned by market observers, but such forecasts remain speculative [10]. The current rally appears to be supported by both retail and institutional sentiment, with crowd money showing strong bullish sentiment and smart money turning bearish in response to aggressive shorting attempts [11].

Sources:

[1] [https://coinmarketcap.com/community/articles/68961a44e21b950c870dd3cb/](https://coinmarketcap.com/community/articles/68961a44e21b950c870dd3cb/)