In the past 24 hours, Bitcoin briefly surged past $45,800, reaching its highest level this year, fueled by growing expectations that regulatory approval for U.S.-based spot Bitcoin ETFs could be imminent. However, it has since slightly retreated, trading at $45,317 at the time of writing.
The recent uptick in the cryptocurrency market led to significant liquidations of short positions on futures exchanges. Volatility resulted in the liquidation of over $81 million in Bitcoin positions, including $73.2 million in short positions alone.
Data from blockchain analytics platform CoinGlass revealed that the overall crypto market saw over $133 million in liquidated short positions in the last 24 hours, contributing to a total liquidation of $177 million across various centralized exchanges.
Liquidations in futures markets occur when a trader’s position is forcibly closed due to insufficient funds to cover losses. This happens when market movements are unfavorable for the investor’s position, leading to the depletion of their initial margin or collateral.
The global cryptocurrency market cap reached $1.84 trillion on January 2nd, marking a 5.26% increase in the last 24 hours. The anticipation of the U.S. Securities and Exchange Commission (SEC) approving several spot Bitcoin ETF applications may be a factor in the current upward movement of the entire crypto market.
A weekend report by Reuters indicated that the regulatory body could start notifying about the approval status of ETF applications as early as January 2nd. The report mentioned that the SEC has until January 10th to decide on the approval of a spot Bitcoin ETF proposed by Ark Investments and 21Shares, and it could inform other asset managers about the status of their applications by January 2nd or 3rd. These managers include firms like Valkyrie, Bitwise, WisdomTree, Franklin Templeton, BlackRock, VanEck, and Invesco.