Short squeeze forces liquidation across top 500 cryptos; BTC leads with $71M wiped from shorts
A major short squeeze hit the cryptocurrency market, triggering roughly $200 million in short liquidations across futures and perpetual contracts — the largest such event among the top 500 coins since the Oct. 10 selloff. Bitcoin (BTC) saw the biggest share of liquidations at $71 million over 24 hours, followed by Ether (ETH) with $43 million and Dash (DASH) with $24 million, according to Glassnode. The squeeze coincides with a shift in investor sentiment from fear to greed and early signs of a market recovery. Analysts cite rising geopolitical volatility, including fallout from the U.S. capture of Venezuela’s president and concerns around Federal Reserve independence, as factors that may boost demand for Bitcoin as an alternative reserve asset. Market commentators also noted a possible ‘risk premia’ for BTC amid a criminal investigation involving Fed Chair Jerome Powell. Traders should note the concentrated liquidations in BTC and ETH, the rapid change in sentiment, and geopolitical drivers that could amplify volatility in the near term.
Bullish
The short squeeze and $200M of liquidations — led by $71M in BTC and $43M in ETH — signal forced short covering and an influx of buying pressure. Historically, large short squeezes can catalyze short-term rallies as leveraged positions are closed and momentum traders pile in (see Oct. 10 event referenced). The shift in investor sentiment from fear to greed supports the immediate bullish classification. Geopolitical volatility and concerns about Fed independence add a macro narrative that can reallocate capital toward perceived alternatives like Bitcoin, reinforcing demand. However, the impact may be concentrated and volatile: short-term upside is likely as deleveraging completes, but sustained long-term gains will depend on follow-through buying, macro developments, and regulatory news. Traders should expect heightened intraday volatility, possible continuation of the rally if volume persists, and rapid reversals if selling resumes or macro factors change.