$200M Bitcoin Buy Sparks Massive Short Squeeze, Rekt Bears

• Investors betting against Bitcoin grew to some of the highest on record as markets welcomed the new year.
• A purchase of roughly $200 million in Bitcoin on spot trading markets was enough to force massive short liquidations due to dwindling volume.
• Liquidation became dominated by failing short positions that were ‚rekt‘ by Bitcoin’s price increase.

As the new year rolled in, investors betting against Bitcoin grew to some of the highest on record. Bears were in control of the market, pushing the price of Bitcoin to hover around $16,000. However, a purchase of roughly $200 million in Bitcoin on spot trading markets was enough to force massive short liquidations due to dwindling volume. In addition, several large trades executed on major exchanges moved the needle just enough to create a short squeeze that took Bitcoin from $16,800 to over $21,000.

An analysis done by CryptoSlate found that those shorting Bitcoin were not in as strong a position as investors first thought. A chart showing the futures long liquidations dominance (long liquidations divided by (long liquidations + short liquidations)) showed that liquidation had become dominated by failing short positions that were ‚rekt‘ by Bitcoin’s price increase. Over two years, the dominance rose to the highest level as those betting against Bitcoin lost out.

The huge spike in the price of Bitcoin caused a massive shift in the market. As investors saw the price continue to rise, the amount of shorts dwindled, and the amount of longs increased. This shift in the market was reflected in the chart, with the dominance of long liquidations increasing significantly in a short amount of time.

This sudden surge in Bitcoin’s price has caused a great deal of speculation in the market. Many investors are looking to take advantage of the situation, while others are wary of what could happen next. Some experts are predicting that Bitcoin could continue to surge, while others believe that this is just a temporary surge before the price falls back down again.

Regardless of what the future holds, it is clear that the market is in a state of flux. The recent surge in Bitcoin’s price has caused a great deal of volatility in the market, and investors should be prepared for both the highs and the lows. As the market continues to evolve, it will be interesting to see how the dominance of long liquidations changes over time.

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