How to Short on Bybit?
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A short crypto squeeze is triggered when the price of a cryptocurrency rises rapidly. This triggers a lot of collateral requests and, in the worst case, liquidations.
If the liquidation takes place, it will cause an additional price increase and even more liquidations related to short sales.
This is also a way for large institutions to do market manipulation. If you have money on hand and find a large short position in the market, you can go buy shares in the open market to push the price up and force a short squeeze.
One of the most famous short squeezes was when Reddit Wallstreetbets Community found that Gamestop stock was shorted by large institutions. The community agreed to short squeeze these institutions by buying large amounts of shares.
All in all, they were successful in terms of short squeeze. However, many small traders lost large sums of their capital when the share price was lowered because no one could hold back the high Gamestop price.