A bitcoin exchange-traded fund’s popularity and a flight to safety that resulted in an increase in short liquidations helped push the price of bitcoin momentarily above $35,000 for the first time since May 2022.
According to Coin Metrics, the price of bitcoin on Tuesday increased by more than 9% to $34,349.55. It reached its highest point since May 8, 2022, late Monday night, at $35,113.29. Since the start of the year and its 2022 low, Bitcoin has increased by approximately 110%.
A short squeeze, or the rushing of investors who were betting against the cryptocurrency asset to cover short bets, may have contributed to the surge. According to cryptocurrency analytics source CoinGlass, there were $275.45 million in short liquidations of bitcoin on Sunday, and another $100.44 million on Monday.
The $167 million in short liquidations, mostly on offshore exchanges, were the “true impetus” that produced the “god candle” and drove bitcoin past $34,000 on Monday, according to Ryan Rasmussen, analyst at Bitwise Asset Management. “I don’t think anyone anticipated the level of price activity we’re seeing, and those investors who were shorting bitcoin in the $33,000+ region are clearly experiencing the impact of that surprise,” said the author.
Source (CNBC)
