Bitcoin Short Sellers Lose $504 Million as BTC Rebounds Above $63K

Bitcoin's sharp recovery from last week's decline triggered a massive short squeeze, resulting in significant losses for traders who had bet on further downside. According to data from CoinGlass, cryptocurrency short sellers lost approximately $504 million in liquidations during the 24 hours leading into Monday morning, marking the largest single-day loss for bearish traders since late April.

By comparison, traders holding long positions experienced around $151 million in losses. Overall, the crypto market recorded nearly $655 million in liquidations, affecting more than 104,000 traders worldwide. Bitcoin-related positions accounted for roughly $315 million of the total liquidations, while Ethereum positions represented about $201 million.

One of the largest liquidations occurred on crypto exchange OKX, where a single Bitcoin futures position worth $12.3 million was forcibly closed. Liquidations occur when exchanges automatically terminate leveraged trades that move too far against a trader’s position, preventing further losses.

The latest wave of liquidations follows a turbulent period for Bitcoin. The leading cryptocurrency dropped nearly 14% last week and briefly fell below the $60,000 level. Market pressure intensified after Strategy completed its first Bitcoin sale since 2022, while weakness in artificial intelligence-related stocks and continued outflows from spot Bitcoin exchange-traded funds (ETFs) further weighed on sentiment.

Many traders increased their short exposure near Bitcoin’s recent lows, expecting additional declines. However, Bitcoin unexpectedly reversed course and rallied toward $63,800 on Sunday, catching bearish traders off guard and triggering widespread liquidations.

Despite the strong rebound, market volatility remains elevated. Renewed geopolitical tensions between Iran and Israel pushed oil prices more than 3% higher and contributed to weakness across Asian equity markets, including a sharp decline in South Korea’s KOSPI index. Bitcoin later pulled back to around $62,900 but remained comfortably above last week's lows.

Bitcoin briefly climbed to approximately $63,700 on Monday before retreating. Analysts expect continued volatility as investors monitor upcoming U.S. inflation data and major public offerings expected to attract significant market attention. The combination of macroeconomic developments, geopolitical risks, and institutional investment flows is likely to remain a key driver of Bitcoin price action in the coming days.