Bitcoin soars above $71,000 on Ether ETF rumors, causing $260 million worth of short sales

Early Tuesday, Bitcoin (BTC) soared past $71,000, reaching its highest level since early April. Ether also saw a significant increase, jumping over 19% to $3,700. 

This surge followed Bloomberg analysts’ revised prediction, which now puts the likelihood of a spot ETH exchange-traded fund (ETF) being approved in the U.S. at 75%.

According to CoinGecko data, other major cryptocurrencies experienced more modest gains, with XRP, Cardano’s ADA, Solana’s SOL, and Dogecoin (DOGE) increasing by 3-6%. 

This sudden upward trend led to over $260 million in market-wide short liquidations, the largest since February 28.

Data from Coinglass indicates that Ether shorts faced losses exceeding $115 million, while Bitcoin shorts incurred losses of just over $99 million.

Binance, a cryptocurrency platform, had the most liquidations, with more than $130 million. OKX came in second with $118 million, and Huobi came in third with $51 million. 

A lot of damage was done to short holdings, which are bets against prices going up. 

When an exchange closes a trader’s leveraged position because they can’t meet margin standards, the trader loses some or all of their initial margin. This is called liquidation.

Late Monday night, Bloomberg experts Eric Balchunas and James Seyffart raised the chance of a spot ether ETF approval from 20% to 75%. 

This caused the market to start going up. 

A CoinDesk story said that the U.S. Securities and Exchange Commission (SEC) had asked exchanges that want to offer ether ETFs to update their 19b-4 filings before this week’s important deadline. This made the price go up even more.

People in the market think that the acceptance of an ether ETF is a very good thing that could bring in a lot of institutional capital. 

Since it began selling in January, the spot Bitcoin ETF has brought in a total of $12 billion for BTC. Its investors include large trading firms and state funds.

Some traders think that the price of ether will keep going up over the next few days. 

“We don’t think the current price will last,” they said. If approval is given, prices could rise to around $4,000. If it is not, prices could fall to around $3,000.” 

This was said by Singapore-based QCP Capital in a show on Tuesday. They also said that exchanges are being asked to update 19b-4 files more quickly, which could mean that approval is coming soon.