Bitcoin’s rapid price rally has caught traders off guard, triggering large liquidations of bearish short positions.

The leading cryptocurrency by market value has risen over 3% to $102,500 in the past 24 hours, with prices topping $104,000 at one point, the highest since Jan. 31. The bullish move came as President Donald Trump announced a comprehensive trade deal with the U.K. and the cumulative inflows into the spot exchange-traded funds (ETFs) hit a record high above $40 billion.

The broader market rallied as well, with the total market cap of all coins excluding BTC surging by 10% to $1.14 trillion, the highest since March 6, according to data source TradingView.

That has led to substantial liquidations of bearish short positions, or leveraged plays aimed at profiting from price losses. A position is liquidated or forced closed when the trader’s account balance falls below the required margin level, often due to adverse price movements. This leads the exchange to close the position to prevent further losses automatically.

Nearly $400 million in BTC short positions were liquidated in the past 24 hours—marking the highest single-day total since at least November, according to Coinglass. Meanwhile, $22 million in long positions were also wiped out.

This significant imbalance indicates that leverage was heavily tilted towards the bearish side, and the rapid liquidation of shorts suggests there could be more upside potential for the market ahead.

A broad crypto rally led by ether’s (ETH) 20% surge triggered more than $750 million in short liquidations in the past 24 hours, the highest single-day total since 2023 for bearish trades.

Data from CoinGlass shows that over 84% of the total liquidations came from shorts, with major altcoins jumping 10%–20% in the span of a few hours starting late Thursday.

Ether led the charge with a 20% rise, pushing past $2,000 for the first time since early March. DOGE and Cardano’s ADA zoomed more than 10%, fueled by bullish sentiment and momentum trading, with Solana’s SOL, BNB and xrp (XRP) up at least 7%.

Liquidations occur when an exchange forcibly closes a trader’s leveraged position due to insufficient margin. It happens when a trader cannot meet the margin requirements for a leveraged position, that is, when they don’t have sufficient funds to keep the trade open.

Large-scale liquidations can indicate market extremes, like panic selling or buying. A cascade of liquidations might suggest a market turning point, where a price reversal could be imminent due to an overreaction in market sentiment.

As such, the uptick in crypto markets came as bitcoin surged above $100,000 on Thursday, with sentiment buoyed on a trade deal between the U.S. and the UK.

The late Thursday wipeout ranks among the most severe since Bitcoin’s run to $93,000 in March, which saw bears lose over $550 million in a weekend squeeze.

In April, a similar rally in ETH and DOGE erased $500 million in shorts — but this move surpassed both, showing renewed risk appetite and a crowded short trade setup.

Coinglass data shows that the largest share of losses came from Binance and OKX, which accounted for more than $500 million in liquidations. ETH alone was responsible for over $310 million, while bitcoin-tracked futures led at $375 million.

The short squeeze on ETH came as the asset had been rangebound for a few weeks amid falling institutional interest and retail sentiment. But Ethereum’s recent Pectra upgrade may be giving traders a reason to bet on the asset, some say.

Ethereum’s ether ETH led the market in early Asia hours as traders reacted favorably to the protocol’s recent Pectra upgrade, sending the token up nearly 20%, the biggest gain since 2021, and trading above $2100 according to market data from CoinDesk.

The move comes amid a broader crypto market rally that coincided with bitcoin BTC soaring past $100,000 for the first time in three months.

Ethereum’s Pectra upgrade, its most substantial overhaul since the 2022 Merge, represents a sweeping protocol hard fork, as CoinDesk previously reported.

The upgrade consolidates validator operations by raising the staking limit from 32 to 2,048 ETH (via EIP-7251), advances wallet usability through account abstraction mechanisms allowing temporary smart contract functionality (via EIP-7702), and implements nine other Ethereum Improvement Proposals.

«ETH is finally catching up after lagging behind BBTC for most of the year. While BTC is nearing its all-time high, ETH is still down nearly 50% from its 2024 peak,» Ming Jung from Presto Research wrote to CoinDesk in a note.

The Pectra upgrade, Jung said, «helped restore some confidence, and with ETHBTC down nearly 40% year-to-date at 0.02, it’s not surprising to see buyers stepping in at these levels.»

In a recent research report, CryptoQuant wrote that weak network activity on the Ethereum blockchain, which hasn’t grown since 2021, suggests that a recovery to prior highs isn’t imminent despite the rally.

In a market update, Flowdesk wrote that they see the crypto market broadly regaining momentum, with bitcoin passing $100K and a return to risk appetite, with investors shifting from caution to chasing higher-yield altcoins and structured products.

«We’re seeing a recycling of sell flow into higher-momentum plays, a shift from the caution that’s defined the last two months. While still below Q4 2024 levels, beta appetite is clearly building,» Flowdesk wrote.

March Zheng, General Partner of Bizantine Capital, told CoinDesk in a message that traders should remember that Ethereum has typically been the main on-chain altcoin indicator for risk-on, and its sizable upticks generally lead to broader altcoin rallies.

Elsewhere in crypto, bitcoin (BTC) is trading above $102.5K as ETF inflow continues to be positive. In a recent note, Standard Chartered said that its second quarter target of $120,000 might be «too conservative. Other market observers consider current upside targets to be «too low.»

Meanwhile, the CoinDesk 20, a measure of the performance of the largest digital assets, is up over 10%.

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