Bitcoin and Ethereum Surge Triggers Massive Short Squeeze

The cryptocurrency market has witnessed a dramatic price surge for Bitcoin and Ethereum, resulting in significant losses for short traders. According to data from CoinGlass, the past 24 hours have seen over $383 million in crypto liquidations, with shorts bearing the brunt at $297 million. This wave of liquidations affected more than 94,000 traders, with the largest single liquidation event involving $4.26 million.

Ethereum (ETH) traders faced the most severe impact, with $131 million in liquidations, while Bitcoin traders followed with $108 million in losses. Ethereum, in particular, has seen a notable price increase, climbing 22% compared to Bitcoin’s 4.6% rise, as per CoinGecko’s data.

This surge in market activity was influenced by a bullish development on Monday when the Securities and Exchange Commission (SEC) began engaging with national securities exchanges about their applications to list Ethereum spot ETFs. If approved, these ETFs, backed by heavyweights like BlackRock, Fidelity, and Grayscale, would enable institutional investors to gain spot exposure to ETH, similar to the impact Bitcoin spot ETFs had when they were introduced in January.

The anticipation of Ethereum spot ETFs has stirred considerable excitement among ETH enthusiasts, buoyed by the prospect of increased institutional interest and investment. Bloomberg’s ETF experts have revised their approval odds for these ETFs from 25% to 75% following Monday’s developments.

In light of these market movements, Glassnode analyst James Check suggested that the cryptocurrency market might be on the cusp of a “second wave” of ETF-driven demand. “For some reason, people keep betting against this uptrend… with leverage no less,” Check noted in his latest newsletter. He observed that despite the prevailing bullish trend, many are skeptical about Bitcoin’s sustainability, yet he believes they are “swimming against the tide.”

This recent price action and the potential for new ETF approvals could mark a pivotal moment for both Bitcoin and Ethereum, potentially leading to broader acceptance and integration of cryptocurrencies in mainstream financial markets.