The drop in Bitcoin price to $61,100 on Friday led to the liquidation of $335 million in leveraged long positions. However, after the last decline, the market structure indicates that the downward pressure may be limited this time. According to the data, short positions accumulated between $63,000 and $66,000 brought up the risk of a squeeze of approximately $2.6 billion if the price recovers.
Accumulation came to the fore in short positions
According to estimated liquidation data on major exchanges, approximately $1.2 billion in additional liquidations could occur if Bitcoin falls from $62,000 to $57,000. On the other hand, if the price rises to $66,000, the size of the short positions that will be at risk reaches $2.6 billion. This picture indicates that the buyer appetite, which has weakened recently, may regain strength with a sudden recovery.
Successive net outflows in spot Bitcoin ETFs also stood out as one of the important elements of the pressure on the market. Spot Bitcoin ETFs traded in the USA suffered serious fund losses during the 13-day outflow streak. The limited net inflow of $3 million recorded on Thursday was considered a temporary respite after the 15-day sales wave.
Market data shows that a possible move towards $66,000 could pressure a $2.6 billion short position, while a drop to $57,000 would leave the estimated liquidation amount at $1.2 billion.
Negative funding rate attracted attention
The decline in the annualized funding rate in Bitcoin perpetual futures to minus 2 percent was also among the indicators followed closely by the market. While the range generally considered neutral lies between 6 percent and 12 percent, the current negative ratio reveals that short positions are becoming more dominant. This also suggests that bullish investors have significantly reduced their leverage and downside fragility has weakened.
Mini glossary: Funding rate is the periodic payment mechanism used to maintain the balance between long and short positions in perpetual futures markets. When the ratio turns negative, it indicates that short position demand has increased in most cases.
However, analysts state that the impact of the possible squeeze may be limited in a scenario where investors holding short positions keep their leverage levels low. Therefore, not only the open position size but also how aggressively these positions are opened will be decisive.
Technology stocks and liquidity pressure
While Bitcoin has recently remained significantly weaker compared to the Nasdaq 100 index, sales on the technology front have also affected risk appetite. As Broadcom stock fell 12.6 percent on Thursday, $280 billion was erased from the company’s market value. The company’s lowering of its artificial intelligence chip sales forecast for the second half of 2026 caused investors to be more cautious.
A similar push followed in other major AI-related stocks. Micron fell by 7.8 percent and Arm by 4.5 percent. It is considered that investors may be inclined to raise cash before the expected public offerings of companies such as SpaceX, Anthropic and OpenAI, and this draws liquidity from different markets, including crypto assets.
Jeff Park, partner at ParaFi Capital and advisor to Bitwise, argued that the theme of artificial intelligence has created an intense capital attraction in the market. According to Park, if this interest weakens over time, capital may return to Bitcoin. On the other hand, if spot Bitcoin ETF inflows accelerate again or concerns about the 32 BTC sale around Strategy shares ease, the current short position density may make price movements harsher.
