As Ethereum and BNB Face Liquidation Fears, BCH Alone Sparks Rally Hopes

▲ BNB, Ethereum (ETH), Bitcoin Cash (BCH) / AI-generated image

As the cryptocurrency market’s downturn deepens in the final week of February, concerns are rising over the possibility of a short squeeze triggered by excessive bearish bets.

On February 23 (local time), crypto-focused media outlet BeInCrypto reported that three altcoins—Ethereum (ETH), BNB, and Bitcoin Cash (BCH)—are facing significant liquidation risks this week. Although short positions betting on further price declines currently dominate the market, the entry of prices into strong demand zones raises the possibility that an unexpected rebound could trigger a short squeeze, inflicting heavy losses on short sellers.

An analysis of Ethereum’s seven-day liquidation map shows a concentration of capital and leverage on the downside. If ETH rebounds to $2,000 this week, approximately $2 billion worth of short positions could face forced liquidation. Should the rally continue and reclaim the $2,160 level, the liquidation figure could swell to $3.6 billion. While Ethereum co-founder Vitalik Buterin sold more than 8,800 ETH during February and exchange inflows have increased—factors seen as bearish—there are also clear signs of a rebound, including a record-high inflow into accumulation addresses over the past six months.

BNB has also declined for six consecutive weeks, with short positions dominating the market, yet the potential for a technical rebound is being raised. If BNB reaches $640 this week, around $35 million in short positions could be liquidated, and a move to $680 could trigger more than $60 million in liquidations. On-chain analytics account On-Chain Mind noted that BNB is currently trading about 37% below the realized price of short-term holders, a level that historically preceded sharp price readjustments. Its proximity to a long-term support line established since 2024 also poses a threat to short sellers.

Bitcoin Cash has recently seen aggressive accumulation by whales, increasing the likelihood of a rebound. A single whale address has amassed 400,000 BCH over the past two months, making it the third-largest holder on the network. Meanwhile, the network’s average transaction value has surged more than 100-fold from last year to exceed $2 million. If Bitcoin Cash climbs to around $630 this week, approximately $45 million in short positions could face liquidation risk.

Ironically, the extremely negative sentiment across the broader crypto market may be creating optimal conditions for a powerful rebound. Tyler Winklevoss, co-founder of Gemini, said he remains optimistic precisely because current market sentiment is so deteriorated. Investors are advised to be cautious with excessive leverage and focus on risk management in case of sudden price reversals, making disciplined profit-taking strategies essential at this time.

*Disclaimer: This article is for investment reference purposes only and we assume no responsibility for any investment losses incurred based on its content. The information herein should be interpreted solely for informational purposes.*