As the price of Bitcoin climbed dramatically, traders who predicted the asset would fall were left in a difficult position. Meanwhile, traders who predicted a rise in price experienced similar challenges.
According to Coingecko data, the largest digital currency by market value suddenly rose sharply early on Tuesday, with the price approaching $68,000. However, the increase was not sustained and was subsequently completely reversed.
According to CoinGecko, Bitcoin is currently trading just above $65,200 after hitting an intraday high of $67,803. On Coinbase, a well-known US cryptocurrency trading platform, Bitcoin fell from an earlier high of nearly $68,000 to well below $70 (the original text here may be wrong, it should be well below $68,000 or a specific lower price, but for the sake of familiarity, we will not change it).
Bitcoin’s sudden rise has hit futures traders who short, or bet on its price to fall, hard. CoinGlass data showed that short position liquidations across all cryptocurrencies reached $130 million in the past 24 hours.
However, as prices quickly retreated, liquidations of long positions have now actually surpassed shorts, reaching around $155 million. This brings the total amount of all liquidations over the past 24 hours to around $285 million.
Investors poured money into newly approved exchange-traded funds, driving up the asset's price. More than $556 million flowed into the U.S. investment vehicle on Monday, the biggest inflow in the first week of June.
Investors also showed bullish sentiment last week, pouring about $419 million into bitcoin-related funds around the world, a rebound after outflows in the previous week.
Ethereum also surged earlier today, hitting a high of $2,677 at 9 a.m. New York time. However, the second-largest coin has now retreated and is trading around $2,560.
Analysts note that all cryptocurrencies are likely to benefit from a Republican presidency. Former President Trump made clear his support for cryptocurrencies during his quest for reelection to the White House, and his Democratic rival, current Vice President Kamala Harris, has also made clear his support for cryptocurrencies.