A sharp squeeze in cryptocurrency markets forced the liquidation of $113 million in short positions over a 24-hour period ending October 5, 2026, according to Coinglass data. The figure represented the vast majority of approximately $138 million in total liquidations recorded during the window, with long positions accounting for only $25.16 million—meaning shorts were liquidated at more than four times the rate of longs.
Liquidations occur when leveraged traders' collateral can no longer cover their losses, triggering automatic position closure by exchanges.
Where the Damage Concentrated
Bitcoin short positions led the liquidations, with $57.07 million in shorts closed—roughly half of all short liquidations during the period. Ethereum followed with $24.04 million in short positions erased.
The single largest liquidation was a $5.63 million ETHUSDT short position on Binance. Across all tracked venues, 42,225 traders were liquidated during the 24-hour window.
The Mechanics of a Squeeze
When short positions are liquidated, exchanges must buy back assets to close those positions. This buying pressure can drive prices higher, triggering additional liquidations and creating a cascading effect.
The lopsided split between shorts and longs indicates that a significant number of traders had positioned for falling prices, only to be caught off guard by upward movement.
A Repeat Pattern
This liquidation event mirrors an earlier episode in July 2026, which also produced exactly $113 million in short liquidations. That earlier squeeze coincided with a 4.5% rise in Ethereum toward $1,980, a move that occurred amid inflows into Ethereum ETFs.
Both episodes demonstrate how upward price moves can rapidly flush out bearish positioning, particularly when those moves catch leveraged traders unprepared.
What Comes Next
Market observers will watch whether funding rates and open interest rebuild on the short side, potentially setting conditions for another squeeze, or whether this weekend's liquidations reset positioning toward more balanced levels.
