Key Takeaways:
- Shiba Inu rose 12% to $0.00000495 as crypto markets rallied Thursday.
- Short liquidations hit $3.1 billion, the largest forced short closure since 2021.
- Treasury buybacks and Trump's Clarity Act push fueled the risk-on move.
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Shiba Inu jumps 12% as $3.1 billion short squeeze hits market
Shiba Inu rose 12% to $0.00000495 as a record $3.1 billion short squeeze swept the crypto market, the largest forced short closure since 2021.
Short liquidations totaled $3.1 billion over 24 hours against $275.45 million on the long side, according to CoinGlass, with more than $1 billion clearing in a single hour. Total liquidations reached $3.38 billion across 192,002 traders.
SHIB on Ethereum surged from a low of $0.00000443, briefly touching an intraday high of $0.00000502 early Thursday before retreating. The token is up 10% over the last seven days, tracking a broader rally that lifted Bitcoin 11% to above $71,000 for the first time since June.
The move was mechanical rather than narrative-driven. Bitcoin spent six weeks between roughly $62,000 and $66,900 with volatility grinding down to multiyear lows, leaving a thick band of short liquidation levels between $65,000 and $67,000. The U.S. Treasury's announcement that it would at least double long-dated buyback operations to $4 billion pulled the 30-year yield back from 5.337%, and the resulting bid in risk assets was enough to clear the ceiling.
President Donald Trump's comments landed hours later into a market that had already made the bulk of its move. His call for Congress to pass the Clarity Act, a suggestion that the U.S. may buy sizable amounts of bitcoin and the reveal that regulators are working on a compliant pathway for Hyperliquid gave the rally a second leg.
At the SALT conference Tuesday, Tim Scott, who oversees the Senate Banking Committee, said the Clarity bill had a high chance of advancing in September, with a procedural vote expected September 15. The legislation would classify digital assets like XRP as commodities under federal law.
Ether rose 19% to $2,270, its highest in three months, while SOL, XRP and DOGE posted double-digit advances. Coinbase's Fear and Greed index jumped to 59, a "greed" reading, from 41, "fear," while bitcoin daily trading volume rose 250% to $59 billion.
The short squeeze showed how stretched the downturn had become. After months of selling and a descent into the low $60,000s, bearish positioning had piled up in an asset with a long history of overshooting in both directions. Once prices turned higher, forced buying from short sellers accelerated the rebound.
For SHIB, the immediate test is whether the forced buying gives way to genuine demand. Cryptocurrency exchange UEX US has listed SHIB, offering SHIB/USDT trading with a rewards scheme paying 4.5% annual returns, loans secured with SHIB as collateral, and purchases via PayPal, bank transfers and card payments. As the token bounces back, the number of ways to trade, hold and use it grows.
This article is for informational purposes only and does not constitute investment advice.
[1] Shiba Inu (SHIB) Up 12% as $3 Billion Short Squeeze Fuels Crypto Market Rally[2] Bitcoin breaks out of six-week range, tops $71,000 as $3 billion in shorts get wiped out[3] Crypto surge triggers record US$2.7 billion of short liquidations[4] Is XRP About to Hit a Level Last Seen in November 2024?
