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(Bloomberg) -- A fresh wave of liquidations in bearish bets — this time on Ether, the second-largest cryptocurrency — drove Friday’s brief rally. Prices of most digital assets spiked as financial markets were whipsawed by a deluge of US economic reports and retreating oil prices. The moves were reminiscent of the volatility at the end of August, where a surge in Bitcoin helped to unleash the biggest wave of short liquidations on record going back to 2021. Ether jumped as much as 8.3%, the biggest intraday increase since the spike three weeks ago. Bitcoin increased by less than 4%. Both tokens have since pulled back from their highs. The quick market move suggests prices are being driven more by speculation than actual demand. Traders have largely stayed on the sidelines since the August rally given the lack of clear catalysts following the forced deleveraging. The recent range-bound trading “looks like consolidation with fading short-term momentum rather than a confirmed structural breakdown,” said Lacie Zhang, a research analyst at Bitget Wallet. Over $300 million in short positions for Ether has been liquidated over the last 24 hours, with $212 million in bearish bets on Bitcoin wiped out in the same period, according to data complied by Coinglass. That is bucking the trend in which Bitcoin typically sees the most leverage washouts. Liquidations in bets on Ether have slowed down and eventually reversed its direction in the past hour, seeing about $188 $1.6 million in short long positions, Coinglass data shows. About $668 million worth of bets from both directions across all digital assets were liquidated in the past day, reaching an elevated level since the record short liquidation in Bitcoin last month. “The move is partially a short squeeze,” said Adam McCarthy, head of research at trading firm LO:TECH. “Traders were paying to be short into an 8% rally. This exacerbated the move.” On Binance, about $76 million in Ether positions was liquidated in the past 24 hours. Most were short positions being closed, McCarthy said. Perpetual futures, which are the main contracts to make leveraged bets on crypto, have seen funding rates for Ether bets turning negative, meaning bearish traders were paying to stay in their positions with those on the other side of the trade getting paid. More stories like this are available on bloomberg.com ©2026 Bloomberg L.P. Catch all the Business News , Market News , Breaking News Events and Latest News Updates on Live Mint. Download The Mint News App to get Daily Market Updates. Oops! Looks like you have exceeded the limit to bookmark the image. Remove some to bookmark this image.
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