On December 29th, the market experienced a painful round of liquidation. Data shows that a total of $168 million in positions were forcibly closed that day, with shorts becoming the biggest losers.

Specifically, Ethereum was hit the hardest, with a liquidation amount of $45.26 million. Bitcoin followed closely behind with $44.96 million, which is not negligible, and even Solana contributed $10.77 million in liquidations. What does this liquidation pattern reflect? Essentially, it indicates that short sellers misjudged the market trend—they bet on a decline, only to be brutally slapped in the face by the market's upward trend. The market volatility before the end of the year was indeed fierce.

What further illustrates the point is the data from derivatives. Bitcoin's open interest surged by 4.96%, expanding to $59.4 billion; Ethereum's open interest was even more dramatic, soaring by 5.98% to $39.2 billion. Coupled with the fact that funding rates have remained positive, it’s clear: the bulls have completely taken control.

Honestly, although such large-scale short liquidations look brutal, from a certain perspective, they serve a purpose—clearing out over-leveraged ghost orders in the market. Once these risk exposures are cleaned up, the subsequent upward trend will be healthier and more sustainable. The market is self-repairing.