Reli Bitcoin and Ethereum Liquidate Short Crypto Positions Worth $700 Million

The digital crypto asset market is experiencing a strong bullish momentum, triggering a massive wave of liquidations against traders holding short positions. In the past 24 hours, nearly $700 million in bearish bets have been wiped out from the derivatives market, marking a significant shift in market sentiment.

This achievement began when Bitcoin broke through the $95,000 resistance level, which had been a major barrier for nearly two months. The largest cryptocurrency reached a high of $97,800, up 3.5% in a single day. Meanwhile, Ethereum showed an even more impressive performance with a 5% surge to $3,380, crossing the psychological $3,300 level for the first time since early this year.

Liquidation Impact and Market Mechanisms

The synchronized price breakthrough of these two leading cryptocurrencies triggered panic reactions among futures traders. Of the total $700 million in short positions eliminated, Bitcoin accounted for about $380 million, while Ethereum resulted in over $250 million in automatic liquidations.

Liquidations occur because futures trading systems mechanically close positions when traders’ collateral (margin) no longer covers potential losses. “Breaking above $95,000 triggered massive liquidations, forcing the forced closure of short positions,” said Gabe Selby, head of research at CF Benchmarks.

However, deeper analysis shows that this rally was largely driven by market mechanisms rather than fundamental changes. According to Selby, the price increase “appears mechanical, driven by market makers trying to rebalance supply-demand imbalances left from the sharp declines in October and November.”

Market Signals and Next Targets

Pessimism has shifted to optimism among the crypto trading community. “This breakthrough has sparked significant bullish momentum, with market participants now eyeing the potential to surpass $100,000 and possibly retest all-time highs,” said Joel Kruger, market strategist at LMAX Group.

The previous Bitcoin all-time high was set in early October 2025 at $126,000, creating an ambitious target for bulls. The increased trading volume during this rally indicates that the rise is driven by genuine demand rather than just excessive speculation. Data from CoinGlass shows that funding rates in the perpetual market remain low, ensuring that crypto shorts have not been fully cleared from the system.

Support from traditional markets also plays an important role. Equities remain strong with the S&P 500 and Nasdaq each rising about 1.2%, while bond yields stay stable, creating a conducive environment for risk-taking in crypto assets.

Opportunities and Future Considerations

To confirm the continuation of this trend, Kruger emphasizes the importance of Bitcoin closing weekly above $95,000 or Ethereum surpassing $3,500 as strong bullish signals. Such movements would indicate that the rally is not just a technical bounce but a genuine shift in market sentiment.

However, the momentum’s sustainability depends on global macroeconomic stability. External factors such as geopolitics and fiscal policies remain key variables. Traders considering new positions should stay alert to potential pullbacks and implement strict risk management, especially given the sector’s history of high volatility.

So far, the rally has had a positive psychological impact on the crypto community, marking the end of a consolidation phase and opening a new chapter of more measured upside speculation.