The crypto market’s latest short squeeze has lost momentum after forcing $844 million in losses on bearish traders, with Bitcoin stabilizing and Zcash remaining the only major token in negative territory.
Dogecoin was the standout performer, rising more than 15% to trade slightly above $0.10 during Tuesday’s Asian morning hours, CoinDesk data showed.
Bitcoin was little changed over the latest hour at just above $85,600, extending a roughly 5% gain over the previous 24 hours. Much of the move was driven by short positions being liquidated as the market moved higher.
Crypto liquidations topped $1 billion over the past day, according to CoinGlass. Short sellers accounted for $844 million, or about 82% of the total, while approximately 135,000 traders saw their positions closed.
Short sellers make money when prices decline. To open such positions, traders borrow assets and provide collateral. If prices rise enough to exceed the collateral backing a position, exchanges can automatically buy the asset to close it. Those forced purchases can accelerate gains and trigger liquidations among other short sellers.
Bitcoin represented about $608 million of the liquidated positions, followed by Ether at $181 million. The largest individual liquidation involved nearly $21 million in Bitcoin on Hyperliquid.
Elsewhere, XRP gained 7% to nearly $1.52, while Solana climbed 5% to just below $117. Ether advanced 3% to almost $2,740. BNB and TRX posted gains of between 1% and 2%. Zcash declined 4% to slightly above $1,450.
The pace of liquidations has dropped sharply. Less than $11 million of positions were liquidated in the latest hour, compared with more than $300 million per hour at the height of Monday’s rally. With the short squeeze weakening, additional upside would require fresh market demand rather than continued forced buying.
AI Momentum Supports Asian Stocks
The positive mood also carried into Asian equity markets, following gains across Wall Street.
MSCI’s Asia Pacific index added nearly 1% for its fifth consecutive advance. Semiconductor companies Samsung Electronics and SK Hynix led the region higher after tracking Monday’s rally in U.S. chip stocks. South Korea’s Kospi gained 2%, while Taiwan’s benchmark reached a record intraday high.
Artificial intelligence remained at the center of investor attention. Wall Street’s rally followed early indications of strong adoption for Meta Platforms’ new AI agent, while AMD moved closer to a $1 trillion market capitalization.
Meta launched Muse, an AI agent designed for Facebook, Instagram and WhatsApp, almost two weeks ago. The application has since overtaken ChatGPT as the top free app on Apple’s U.S. App Store. App-tracking company Apptopia said Muse had accumulated nearly 3 million installations globally and recorded almost 40% more iOS downloads in the U.S. and Canada during its first 12 days than ChatGPT did over its comparable initial mobile period.
The growth of AI agents is also strengthening expectations for greater demand for computing infrastructure. Each response generated by an AI agent requires server resources, raising expectations that widespread adoption could translate into stronger chip demand.
AMD, which generates about 5% of its revenue from Meta, jumped as much as 10% Monday and briefly crossed the $1 trillion market-value threshold. Intel climbed as much as 12%, while Arm gained 14%. Those moves pushed the Philadelphia Semiconductor Index more than 4% higher for a fifth consecutive session.
Alibaba added to the AI momentum in Asia, announcing Tuesday that it was rolling out what it described as China’s “most powerful AI chip.” The accelerator is designed to compete with Nvidia. Alibaba’s Hong Kong-listed shares rose following the announcement, while Tencent also advanced after introducing a new image-generation model.
