Bitcoin price achieved a new all-time high at $25,945 following a large short squeeze in the futures market.
There are many broad reasons behind Bitcoin’s rally, such as the high institutional demand for BTC. But for the current intraday rally, excessive shorting on Binance Futures was likely the primary catalyst.
$25,000 BTC now above stock-to-flow model price
Before the upsurge, many traders were shorting Bitcoin across most major futures exchanges. This eventually led to a short squeeze as short-sellers were selling so close to the previous all-time high. As soon as the record-high broke, BTC began to surge rapidly as Bitcoin price entered price discovery.
According to data from Bybt.com, more than $131 million worth of Bitcoin futures contracts were liquidated in the last 24 hours. As long as the derivatives market continues to see an increase in sellers, the probability of more short squeezes in the near future remains high.
What’s more, the current rally means that BTC is now above the mean line of the popular stock-to-flow model, which forecasts a $100,000 target by December 2021.