Bitcoin Surge Triggers Short Squeeze Fears in Top Crypto Stocks

A recent surge in Bitcoin's price has investors excited and short sellers nervous. According to data from S3 Partners, shares of Strategy Inc (NASDAQ:MSTR), Strive Inc (NASDAQ:ASST) and Coinbase Global (NASDAQ:COIN) are heavily shorted and may be candidates for a short squeeze.

The increased short interest in these stocks could be a bet that they will go down or a hedge against the rising price of Bitcoin. Unlike the iShares Bitcoin Trust (NASDAQ:IBIT), which has low short interest, these three companies have high correlation coefficients with the price of Bitcoin.

Strive Inc, in particular, is highlighted as being much smaller and less followed, with a high short interest rate, making it more likely to experience a short squeeze. Its stock has surged 33.9% over the last month and 210% over the last six months, but another rally in Bitcoin's price could put Strive back in the spotlight.

The report notes that high volatility in cryptocurrency and crypto-related stocks makes it difficult to predict what will happen next.