Ethereum Short Squeeze: Bitfinex Sees $670 Mln Bloodbath After This

Ethereum (ETH) tracked a broader recovery in the crypto market, jumping over 5% in the past 24 hours as sentiment improved.

The token was last trading at $1,882.80, according to data from Coinmarketcap.com. But its latest bounce blindsided traders with a big short position on the token.

Data from Coinglass shows that a whopping $682 million short positions were liquidated in the past four hours, with a majority of these occurring on crypto exchange Bitfinex.

The exchange, which has a 100% short rate on Ethereum, saw nearly $670 million in liquidations in the past four hours, all of them short positions.

Ethereum sees its biggest single-day short liquidations in three years

With the liquidations on Bitfinex, Ethereum has seen its biggest amount of one-day liquidations in three years, according to data from CryptoQuant. Total liquidations in the past 24 hours stood at nearly $698 million, with 99.5% of these being short.

The high amount of short positioning indicates that a lot of market sentiment was geared against the second-largest cryptocurrency.

Ethereum was also trading around a key level of $1700- its weakest since July 2021. A breach below this was likely to trigger more losses in the token.

A bulk of Ethereum’s recent price action has been dictated by anticipation of its upcoming shift to proof-of-stake.

Major merge test coming up this week

While Ethereum is rising, it could consolidate these gains ahead of a key PoS test this week. The Ropsten Testnet, one of the blockchain’s most important testnets, is set to deploy a PoS model this week.

The blockchain now has two more testnets to clear before it can even set a date for a broader shift for the merge, according to developer Tim Beiko.

While Ethereum founder Vitalik Buterin said the merge could come by as soon as August, Beiko’s comments may point to a potential delay.

Still, the merge is expected to be bullish for Ethereum, given that it greatly reduces the blockchain’s operating costs and makes it more accessible.

With more than five years of experience covering global financial markets, Ambar intends to leverage this knowledge towards the rapidly expanding world of crypto and DeFi. His interest lies chiefly in finding how geopolitical developments can impact crypto markets, and what that could mean for your bitcoin holdings. When he isn’t trawling through the web for the latest breaking news, you can find him playing videogames or watching Seinfeld reruns.
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