Short Traders Stung by Bitcoin’s Price Spike to $30K, Suffering Worst Losses in 2 Months

According to data from CoinGlass, short traders experienced significant losses in a single day, the largest since April, as over $178 million worth of bets against crypto tokens were liquidated in the past 24 hours. The total liquidations, which include both long and short positions, exceeded $203 million.

Among the futures contracts, bitcoin (BTC) futures incurred losses of $75 million, followed by ether (ETH) futures at $51 million. Altcoin futures, particularly Pepecoin (PEPE), saw losses of just under $10 million.

Liquidation is a process in which an exchange forcefully closes a trader’s leveraged position. This action is taken when the trader is unable to fulfill the margin requirements necessary to maintain the leveraged position and lacks sufficient funds to keep the trade open. As a result, the exchange steps in and closes the position, potentially leading to a loss of the trader’s initial margin.

Shorts refer to bets against price increases, while longs indicate bets on price rises for financial assets. Binance, a crypto exchange, recorded the highest losses among its counterparts, totaling $65 million, followed by OKX at $58 million.

Significant liquidations can indicate the local top or bottom of a steep price movement, providing traders with an opportunity to adjust their positions accordingly.

Bitcoin breaches $30,000

Bitcoin reached the $30,000 level for the second time this year, likely influenced by a surge in ETF filings in the U.S. This development may have bolstered a bullish outlook among traders, leading to a rally in major tokens. Cardano’s ADA, Solana’s SOL, and Dogecoin (DOGE) posted weekly gains of at least 18%.

Data suggests that Bitcoin’s sudden price increases have also prompted options traders to bet on even higher prices. This sentiment marks a significant shift from the beginning of June when regulatory actions against crypto exchanges Binance and Coinbase in the U.S. dampened bullish hopes.

Market observers anticipate this trend to continue if ETF applications from traditional finance giants such as BlackRock receive approval in the coming months.