$39m derivatives squeeze exposes crowded short bets as bitcoin holds key levels
CoinGlass data show short positions made up 89% of a $39m liquidation wave, underscoring leverage risk on offshore crypto exchanges.
A sharp unwind of leveraged bearish positions swept through crypto derivatives markets on Tuesday, with roughly $39.12 million liquidated in a four-hour window as bitcoin and ether held firm above key support levels. Data from analytics platform CoinGlass showed the wipeout was overwhelmingly concentrated among traders who had bet on further declines, a pattern more consistent with a short squeeze than any renewed wave of spot selling.
Short positions accounted for $34.68 million of the total, or 88.65%, while longs made up just $4.44 million, or 11.35%. For a market that has spent much of the past year under regulatory scrutiny over leverage practices on offshore venues, the imbalance offers a fresh illustration of how quickly crowded positioning can reverse once prices stabilise.
Binance and Bybit dominate the flush
Binance accounted for the largest share of liquidations at $17.12 million, or 43.77% of the total, with $14.95 million of that—87.3%—tied to short positions. Bybit followed with $6.31 million in liquidations, of which 94.77% came from shorts, an even sharper skew than the market leader.
OKX recorded $4.16 million in liquidations, Hyperliquid $3.99 million and Gate $3.58 million, with each venue showing a similarly lopsided short-driven pattern, generally between 93% and 99% of the total. HTX was the exception: of its $1.45 million in liquidations, $1.36 million came from long positions, a reversal that analysts attributed to exchange-specific liquidity conditions rather than a broader shift in market direction.
Bitcoin and ether anchor a 24-hour total above $150m
Over a rolling 24-hour period, bitcoin remained the largest single source of liquidations at $77.62 million, with ether close behind at $62.23 million. Solana added $9.73 million, while the remainder of the altcoin market accounted for a further $15.92 million, indicating that derivatives volatility had spread beyond the two largest tokens into higher-beta assets.
Bitcoin traded around $67,774, up roughly 0.2% on the day, with about $3.2 million liquidated in the preceding hour and $2.9 million over four hours. Ether changed hands near $3,734, up around 0.3%, recording $2.7 million and $2.4 million in liquidations over the same respective windows. The modest spot gains, paired with an outsized short-liquidation total, suggest that bearish positioning had become stretched relative to actual price movement.
The dislocation was more pronounced further down the market. Avalanche rose about 0.7% yet saw $7.1 million liquidated in a single hour and $6.3 million over four, while Solana, trading near $191.53 and up roughly 0.5%, posted $6.2 million and $5.3 million respectively. Sui was flat over 24 hours but still generated a mix of long and short liquidations totalling several million dollars across both the one-hour and four-hour windows, pointing to churn on both sides of the book rather than a single directional trade.
Dogecoin, XRP and Chainlink each showed liquidation volumes running into several million dollars despite only fractional price gains, while Shiba Inu and Pepe posted stronger moves of around 1.1% and 1.4% respectively, consistent with short covering spilling into meme-token markets.
Leverage, not spot flows, drove the move
The episode reinforces a recurring feature of crypto’s largely offshore derivatives ecosystem: sharp, leverage-driven price swings that owe little to underlying spot demand. For UK and European institutions increasingly exposed to crypto through regulated products and custody arrangements, such squeezes are a reminder that volatility priced into perpetual futures on exchanges like Binance and Bybit can outpace anything visible in the underlying asset itself.
With European regulators continuing to scrutinise leverage limits and disclosure standards for retail-facing derivatives under frameworks adjacent to MiCA, episodes like this one are likely to keep surfacing in supervisory discussions, even as the underlying spot market shows comparatively modest movement.
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