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Bearish crypto bets lose record $2.7 billion as bitcoin surges toward $70,000
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- DeepHorus
Bearish crypto traders suffered a record $2.74 billion in losses in a single day as bitcoin surged past $71,000, triggering the largest wave of forced short closures since records began in 2021. The dramatic short squeeze, which briefly pushed bitcoin to levels not seen since early June, unfolded in about an hour and wiped out leveraged positions across major exchanges. According to CoinGlass data, total crypto liquidations reached nearly $3 billion across 172,108 traders, with shorts accounting for roughly 92% of the wipeouts—more than ten times the $257 million in long liquidations.
The genesis of this historic squeeze lies in a rapid price reversal. Bitcoin had been trading near $64,100 on Wednesday before exploding higher, touching nearly $69,900 and eventually crossing $71,000—a swing of more than $5,700 in under 24 hours. This upward momentum forced exchanges to automatically close leveraged short positions as traders ran out of margin, creating a feedback loop that amplified the rally. Liquidation occurs when an exchange forcefully closes a trader's position due to insufficient funds, and the sheer scale of these closures overwhelmed any selling pressure.
To put Wednesday's numbers in perspective, the previous record for short liquidations was set during the October 2025 crash, when bitcoin plunged from its all-time high above $126,000. On Oct. 10, 2025, total crypto liquidations reached $19 billion in a single day—still the largest deleveraging event in crypto history—but shorts accounted for only $2.47 billion of that. Wednesday's short-only liquidations surpassed that figure without any accompanying long-side carnage, making it the most lopsided short squeeze on record.
The squeeze was remarkably concentrated. More than $1 billion of bitcoin shorts were closed in roughly one hour, with $1.42 billion closed over the full day. Ether shorts totaled $1.13 billion, and solana shorts added $104.67 million. The largest single position wiped out was a $48.8 million bitcoin trade on Hyperliquid, illustrating the extreme leverage that had built up in the market.
However, there is an important caveat to this record. Binance, one of the largest crypto exchanges, restricted its liquidation reporting in April 2021, and CoinGlass only publishes one liquidation order per second from the exchange. Both Wednesday's figure and all historical comparisons may therefore understate the true totals, meaning the actual short squeeze could have been even more severe than reported.
The impact of this squeeze extends beyond the traders who were liquidated. A move of this magnitude clears out bearish positioning, which removes the fuel that drove the rally. Analysts warn that moves built on forced buying rather than fresh demand have a habit of giving back some of their gains, and the key test will be whether bitcoin can hold above $71,000 through the European session. If it fails, the short squeeze could prove fragile, as the underlying demand may not be sufficient to sustain these levels.
Reactions from the crypto community have been mixed, with some traders celebrating the victory over shorts while others caution that such violent moves often signal heightened volatility ahead. Analysts note that the record liquidation figures highlight how leveraged the crypto market has become, and they expect continued turbulence as traders reassess their positions.
Looking forward, the market will watch whether bitcoin can establish $71,000 as a new support level or if the rally fades. The broader context is that crypto markets remain highly sensitive to leverage, and events like this underscore the risks of trading with borrowed funds. As the industry matures, the question of how to manage leverage and avoid such extreme liquidation cascades will likely become a central focus for exchanges and regulators alike.
