Bitcoin Slides to Its Lowest Since 2024 as Short Bets Pile Up
Bitcoin (BTC) fell sharply early Thursday during U.S. trading, dropping about 5% to roughly $58,000 in premarket action—its weakest level since 2024—before rebounding toward $60,000.
The move weighed on the broader crypto complex. Ether slid to around $1,550, down about 5.5%, while Solana and Dogecoin posted similar declines.
Macro pressure has been building across risk assets. In the tech sector, Micron jumped after strong earnings Wednesday evening, but most mega-cap names and the Nasdaq moved lower. The bigger headwind has been the Federal Reserve: officials recently struck a more hawkish tone than markets expected, signaling the next move could be a rate hike, a shift that has pressured Bitcoin along with other risk assets.
Derivatives data, though, paints a more nuanced picture. CoinDesk's review of CoinGlass liquidation statistics suggests liquidation risk sat above the market price, implying that additional downside likely would not have automatically triggered a cascade of forced selling. That dynamic can leave traders pressing fresh downside bets exposed if price turns higher.
Positioning has leaned increasingly bearish. CoinDesk reported open interest rose about 0.28% over the past 24 hours even as Bitcoin fell roughly 3%, indicating traders were adding to shorts rather than closing them as price declined. Funding rates also turned negative, meaning traders were paying to maintain short exposure—an expensive stance to hold for long.
Spot order-book data points to heavier demand below the market than supply above it. CoinGlass depth figures show buy orders of about 6,900 BTC (roughly $409 million) between current levels and $50,000. By contrast, sell orders total about 1,570 BTC (around $93 million) between current levels and $70,000.
Taken together, the setup resembles a crowded short market, raising the odds of a sharp upside move if short sellers rush to cover—often described as a short squeeze, where forced buying accelerates a rebound. Still, the data itself is factual, while the timing and likelihood of a squeeze remains interpretation; markets can stay skewed longer than expected.
Bigger-picture trend remains lower. Even if a squeeze emerges, it would likely amount to a short-term bounce inside a broader downtrend rather than a definitive reversal. In the near term, key factors to watch are whether $58,000 holds as support, whether short positioning continues to build, and whether expectations around the Fed's policy path shift again—developments that may prove more important for Bitcoin's direction in the coming weeks.
