Bitcoin Surges Past $95K Amid ETF Inflows & Short Squeeze

Bitcoin’s price ascent above $96,000, its highest level since mid-November, was driven by a textbook convergence of sustained spot buying and leveraged market fragility. The primary engine was a substantial $753.8 million net inflow into U.S. spot Bitcoin ETFs in a single session, with data from Coinperps showing no outflows across the entire 12-fund complex. This indicates broad-based institutional accumulation rather than isolated product rotation. Fidelity’s FBTC led the charge with $351.4 million, followed by significant contributions from Bitwise’s BITB ($159.4 million), BlackRock’s IBIT ($126.3 million), and Ark/21Shares’ ARKB ($84.9 million).

Compounding this buy-side pressure was a historic wave of forced liquidations. Data from CoinGlass reveals approximately $600 million in bearish crypto positions were wiped out, the largest such event since October 10. Roughly $290 million of this total came from liquidated Bitcoin short positions. These liquidations act as mechanical buy orders when traders’ margin is exhausted, creating a potent feedback loop: ETF inflows tighten spot supply, prices rise, shorts are squeezed, and the resulting liquidations force further buying, relentlessly pushing prices higher.

Beyond immediate technicals, the market is digesting significant structural developments. The recent release of details for the U.S. Senate’s Clarity Act provides a legislative framework to classify crypto assets as either commodities or securities, defining regulatory oversight. Market observers argue this move to formally integrate Bitcoin, Ethereum, stablecoins, and spot ETFs into the U.S. financial system could spur a sustained industry bull run.

This regulatory momentum aligns with what trading firm QCP Capital describes as a ‘Goldilocks environment’—characterized by a robust U.S. job market and stable inflation—that is reviving risk appetite across equities, precious metals, and digital assets. QCP posits that political incentives ahead of the midterm elections encourage maintaining flush liquidity and equity market strength. The firm notes Bitcoin’s break above $95,000 is pivotal, as it had previously lagged the rally in other risk assets, and its relative ‘cheapness’ compared to surging precious metals may now spur a rotation into digital assets.

On-chain metrics reflect this institutionalization phase. CryptoQuant’s Spot Average Order Size data indicates that around the $90,000 level, retail participation remains limited while mid- to large-sized orders are prominent, suggesting large investors are cautiously positioning amid the evolving regulatory landscape.

With the market structure fundamentally altered, analysts are weighing three potential scenarios for Bitcoin in the coming weeks. The first is a ‘squeeze-and-fade’ range trade, where Bitcoin retraces if the torrent of ETF inflows slows or reverses. The second is a ‘flow-led grind,’ characterized by multiple days of positive inflows allowing Bitcoin to behave less like a volatile squeeze chart and more like a market undergoing steady spot accumulation.

The third and most bullish scenario is a ‘reflexive breakout.’ In this case, another cluster of $500 million to $700 million ETF inflow days could trigger a self-fulfilling rally, especially within the current supportive macro and regulatory environment. Allen Ding, Head of Bitfire Research, told CryptoSlate that the breakout past $96,000 for BTC and $3,300 for Ethereum confirms a clear upward direction is now established. He highlighted that this momentum follows a period where Bitcoin’s 30-day implied volatility hit a yearly low of 40%, and will be supported by a stabilizing macro backdrop and liquidity catalysts like South Korea lifting crypto investment bans.

Ultimately, the successful reclaim of the $95,000 level is being viewed as a critical stress test for Bitcoin’s ability to mount a sustained challenge above six figures. The convergence of massive institutional ETF flows, a historic short squeeze, progressing regulatory clarity, and a resilient macro narrative has created a potent mix that has fundamentally reset market dynamics.