Bitcoin (BTC) is caught between the potential for a massive short squeeze and the reality of significant leveraged liquidations, with market sentiment hitting "extreme fear." Data from Coinglass reveals that over the past 24 hours, total liquidations across the crypto market reached $467.64 million, affecting over 137,000 traders. The majority, approximately $434 million, were long positions, indicating a market that was heavily positioned for upside before a sharp downturn.
The most notable single event was the forced closure of a $61.5 million leveraged bullish bet on the HTX exchange, marking the largest individual liquidation in the period. This whale-sized liquidation occurred as Bitcoin's price retreated from a weekend high near $68,600 to around $64,400, erasing recent gains. Analysts suggest this points to a concentrated position from a large fund or investor, rather than retail margin calls.
Simultaneously, analysts are warning of a potential short squeeze risk valued at $9.37 billion. Analyst Ted highlighted on social media platform X that a significant cluster of short positions is stacked above Bitcoin's current price. If BTC's price were to surge by approximately 20%, it could trigger a cascade of these short liquidations, forcing traders to buy back Bitcoin and potentially accelerating the price upward. Conversely, $2.24 billion in long positions sit below the current price, creating a risk zone where a 20% drop could trigger massive sell-offs.
The broader market liquidation leaderboard shows Bitcoin futures led with $213.62 million in forced closures, followed by Ethereum (ETH) at $113.89 million and Solana (SOL) at $19.89 million. The Hyperliquid (HYPE) token also saw a notable $10.72 million in liquidations. Earlier data from a 24-hour period showed Bitcoin, Solana, and Ethereum leading $86 million in liquidations.
Market sentiment has plummeted, with the Crypto Fear and Greed Index hitting a score of 5, signaling "extreme fear." This level has only been seen three other times since 2018. Glassnode data reinforces the stress, noting that the seven-day average for net realized losses among recent Bitcoin buyers remains near $500 million per day, indicating continued capitulation by short-term holders.
