Bitcoin Hits $85K as Short Squeeze Wipes Out $648M in Bearish Bets

Bitcoin continued its move above the upper end of its September trading range on Monday, reaching $84,984 during late European trading. The cryptocurrency gained 5.4% over 24 hours and remained comfortably above the Sept. 4 peak of $82,284.

The rally has been fueled largely by forced buying rather than a broad surge in fresh conviction. Around $746 million in crypto positions were liquidated over the past 24 hours, including $647.9 million in short positions. Another $159.9 million was liquidated during the previous hour, with shorts accounting for 95% of those losses. Bitcoin shorts made up $277.5 million of the daily liquidations, while ether shorts accounted for $122.8 million, according to CoinGlass.

At the same time, total market open interest has increased 7.59% to $156 billion. The rise comes even as bearish positions have been forced out, while 24-hour trading volume has climbed 39% to $224 billion. Together, the figures indicate that traders are quickly rebuilding positions instead of reducing exposure following the rally.

Derivatives Positioning

Futures market activity has also shifted toward the bullish side. The taker long-to-short volume ratio has moved to nearly 53% in favor of buyers, marking the first notable bullish tilt in several weeks. This suggests market orders are increasingly being driven by traders looking to participate in the upside.

Bitcoin futures open interest has also moved above 700,000 BTC for the first time in weeks. Although the figure remains below previous records, the increase points to growing demand for leverage as bitcoin’s spot price advances.

Whale positioning on Binance remains more mixed. The exchange’s whale account long-to-short ratio is close to 1.0, indicating that large traders are placing market orders at relatively balanced buy and sell rates. However, the broader whale derivatives position ratio remains above 2.0, suggesting that major accounts continue to maintain substantial leveraged long exposure.

CRO is showing an even stronger increase in derivatives activity. Futures open interest linked to the token has reached a record 536 million CRO, accompanying its sharp price gains. However, the rise in leverage also brings additional risk. Annualized perpetual funding rates have approached 60%, indicating that long positions have become heavily crowded. Such elevated funding costs can increase the risk of sharp volatility and a potential long squeeze.

Bitcoin and ether are also recording the strongest positive cumulative volume delta readings among the top 20 cryptocurrencies. Positive CVD indicates that buyers are using aggressive market orders rather than relying primarily on passive limit orders.

Volatility expectations have increased only modestly. Bitcoin’s BVIV and ether’s EVIV 30-day implied volatility indexes have edged higher, but remain within relatively normal ranges, suggesting traders are not pricing an unusually disorderly move.

Options traders are continuing to position for further upside as well. Data from Deribit’s options market shows sustained demand for bitcoin and ether calls, while a sizable ether call spread was traded through Paradigm earlier Monday.

Token Market Activity

Sui has emerged as one of the strongest performers among major tokens. SUI gained 12.3% since midnight to $1.0073 and was up 21.4% over 24 hours. Its futures open interest also increased 28.9% to $402 million, indicating that traders are adding exposure alongside the price advance.

AI-related tokens have taken the lead from layer-2 assets in the latest rotation. Artificial Superintelligence Alliance’s FET climbed 8.9% to $0.1911, while Bittensor’s TAO gained 7.0% to $280.13. Venice’s AI inference token VVV had risen as much as 16% earlier in the session.

DeFi tokens are also advancing, although the sector’s momentum has moderated from Friday. Aave gained 7.0% to $147.26, while Ether.fi’s ETHFI rose 6.4% to $0.7691.

Near has cooled after leading the market over the weekend. NEAR was up 2.9% since midnight at $4.29, compared with a 20% gain over 24 hours. Despite the slower price action, open interest remains elevated at $882 million, up 26.8% from a day earlier.

Dogecoin added 10.2% over 24 hours to $0.0939, accompanied by a 15% increase in open interest. Avalanche rose 14.1% to $11.22 while its open interest climbed 19.5%. Both tokens have recovered after lagging the broader market during the middle of last week.

Across the broader market, 95 of the 100 CoinDesk 100 constituents were trading higher, pushing the index up 3.0%. The leadership has shifted from Friday, when smaller-cap cryptocurrencies and DeFi tokens drove the gains.

Macro conditions have remained relatively stable rather than turning decisively more supportive. Brent crude was around $101.97 and little changed on the day after briefly reaching $108 in mid-September. Gold declined 0.65% to $4,350, while silver slipped 0.32% to $66.24.

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