Bitcoin hits fresh record high amid massive short squeeze

Bitcoin has surged to record highs against both the euro and the pound, hitting €60,447 and £51,736 respectively on Coinbase. The primary cryptocurrency has seen an almost 7% increase in the past 24 hours.

Although Bitcoin soared to over $67,620, it has yet to surpass its previous all-time high in U.S. dollar terms, which stood at over $69,000 in November 2021.

Meanwhile, the Dollar Index, a gauge of the U.S. currency’s strength against six major rivals, closed higher last week, adding to a cumulative gain of 2.7% throughout January and February 2023.

A recent market report from Grayscale indicates a steady decline in U.S. inflation since the beginning of the year. Despite this, markets are now anticipating a higher inflation outlook. Analysts at Grayscale suggest that the current uptrend in U.S. interest rates could benefit the dollar’s value while exerting downward pressure on Bitcoin.

The bitcoin price surged above $65,000 in early trading on Friday, triggering a surge in liquidations of leveraged bitcoin positions. The heightened volatility led to decent liquidations, with over $80 million worth of bitcoin positions being liquidated, with the majority ($60 million) being shorts.

Across various centralized exchanges, the overall crypto market saw over $160 million in liquidated short positions in the last 24 hours, contributing to a total of $251 million in liquidations.

Liquidations occur when a trader’s position is forcibly closed due to insufficient funds to cover losses, typically caused by unfavorable market movements depleting initial margin or collateral.

With Bitcoin eyeing its all-time high price of just over $69,000, crypto exchange Coinbase (COIN) gained over 6%, while software company MicroStrategy (MSTR), which holds more than 190,000 BTC on its balance sheet, rose around 8.2% in pre-market trading.

Bitcoin mining companies also felt the positive impact, with CleanSpark leading the pack with an 8% gain, followed by Marathon Digital, Iris Energy, and Riot Platforms with respective advances of 6.6%, 6.8%, and 4.7%.