Investors betting against Bitcoin‘s rising price faced significant losses as the U.S. nears a decision on its first spot Bitcoin ETFs. The SEC is expected to announce its decision on spot ETFs by January 11, while some Bitcoin investors lost over $150 million in the last 24 hours.
Bitcoin’s surge to above $47,000 on the first day of the week hit short sellers hard, with OKX exchange investors bearing the most loss at $84 million, followed by Binance with a $71 million loss.
Open interest, or the number of unsettled futures contracts, rose over 8% in the last 24 hours. This indicates that investors continue to take positions expecting high volatility and potential liquidations to continue.
Liquidation occurs when an investor’s initial margin is partially or fully lost, forcing an exchange to close their leveraged position. This can signal the peak or bottom of a sharp price movement, allowing investors to position themselves accordingly.
The recent spike on January 8 coincided with Bitcoin ETF issuers, from BlackRock to Grayscale, submitting management fees to the SEC, fueling speculation that the launch of the U.S.’s first spot Bitcoin ETF is imminent. The crypto world now awaits the SEC’s decision on 13 spot Bitcoin ETF applications, with some issuers waiving management fees for the first six months or until they reach $5 billion in AUM. Despite mixed signals, a final decision is highly anticipated within two days.