Bearish Bets on Crypto Crushed as $113 Million in Shorts Liquidated

Traders who bet against cryptocurrency faced heavy losses this weekend. Over a 24-hour period ending October 5, 2026, $113 million in short positions were liquidated, making up most of the $138 million in total liquidations. Long positions, which bet on rising prices, accounted for only $25.16 million of the losses. Shorts were liquidated at more than four times the rate of longs.

A liquidation occurs when a leveraged trader's collateral can no longer cover their losses, forcing the exchange to close the position automatically. Bitcoin was the hardest hit, with $57.07 million in short positions liquidated, roughly half of all shorts closed. Ethereum followed with $24.04 million in short positions erased. The largest single liquidation was a $5.63 million ETHUSDT short on Binance. In total, 42,225 traders were liquidated across the platforms tracked by Coinglass.

Binance frequently leads in liquidation volumes, and the largest single wipeout this time also occurred there. This event mirrors a similar wave in July 2026, which also resulted in $113 million in short liquidations. That earlier episode was tied to a 4.5% rise in Ethereum toward $1,980, driven by inflows into Ethereum ETFs.

When shorts are liquidated, exchanges must buy back the asset to close positions, which can push prices higher and trigger more liquidations. The lopsided split between shorts and longs suggests many traders expected prices to fall, but the market moved against them quickly. Moving forward, traders will watch whether funding rates and open interest rebuild on the short side, setting up conditions for another squeeze, or if this weekend's flush resets positioning toward balance.