Karla Barker 
Market sees massive short squeeze
Short traders got hit hard over the past 24 hours. The data shows $414.65 million in total liquidations, with short positions making up 77.67% of that. That’s about $322 million from shorts alone. Honestly, I haven’t seen numbers like this since October 10th—what some traders call Black Friday.
Around 109,672 traders got liquidated during this period. The biggest single hit was on HTX, where a Bitcoin-USDT position worth $91.33 million got forced closed. That’s a massive position to lose all at once.
Institutional money flows back in
What’s interesting here is what drove the move. Bitcoin ETFs saw net inflows of $471 million on January 2nd. That’s a complete turnaround from the $348 million outflow just two days earlier on December 31st. It looks like institutional money came back quickly after the holidays.
The cumulative net inflows into US spot Bitcoin ETFs have reached $57.08 billion now. Total net assets stand at $116.95 billion, which represents about 6.53% of Bitcoin’s total market cap. That’s not nothing.
There’s this clear divide between who was positioned how. Retail traders seemed to be crowded into short positions before the move, while institutional traders held a net long position at 76.52%. The smart money, or at least the big money, apparently saw this coming. Smaller players stayed bearish, and that bet cost them when prices reversed.
Prices move sharply higher
Bitcoin climbed to around $93,700, breaking out of the consolidation that dominated late December. Altcoins did even better. XRP led with a 10.8% surge, followed by Ethereum and Solana at 0.8% and 0.5% respectively. On a weekly basis, the gains look more impressive—XRP up 28.8%, Solana up 11.8%, and Ethereum up 9.6%.
The 12-hour liquidation data shows where things really heated up. $345.15 million in total liquidations happened in that window, with $305.43 million coming from short positions. So most of the squeeze happened in the latter half of the 24-hour period.
Exchange breakdown tells a story
Not all exchanges saw the same pain. HTX took the biggest hit with $108.35 million in liquidations, and a staggering 96.05% of that was from short positions. That suggests their user base was really positioned for a downturn.
Hyperliquid, which tends to attract more sophisticated traders, showed an 87.1% short ratio. Even experienced market participants got caught on the wrong side here.
Binance, the largest exchange by volume, recorded $95.65 million in liquidations but with a lower 63.4% short ratio. That reflects their more diverse user base, I think. The pattern shows bearish conviction had built up pretty broadly across platforms, leaving traders vulnerable when sentiment flipped.
The cascade effect
This created a cascading effect throughout the market. As prices rose, bearish traders had to close positions at a loss, which drove prices higher and triggered more liquidations. That feedback loop amplified the upward momentum.
Crypto analyst Ardi noted on X that “short covering frenzy plus volume delta exploding gave Bitcoin its best price action in a long time.” He observed that nearly $1 billion in shorts had been liquidated over recent days, adding that the liquidation map remains lopsided with heavy short positions stacked above current prices while few long clusters sit below.
The 24-hour long/short ratio has now balanced to 49.99% long versus 50.01% short, which suggests the immediate squeeze has been absorbed. According to Ardi, $94,500 is the level to watch. A close and hold above that could trigger further unwinding of overhead short positions.
It’s one of those situations where the market sentiment got too one-sided. When everyone’s leaning the same way, even a small push can create a big move. The institutional money coming back into ETFs provided that push, and the short positions just amplified everything.