A trader who had extended a 23-win streak with a high-leverage short strategy suffered losses of about $49 million, or about 68 billion won, after Ethereum rebounded sharply. Across the broader market, short positions were liquidated in large numbers as about $3 billion, or about 4 trillion won, in leveraged positions vanished in a single day.

On Aug. 20, blockchain media outlet U.Today reported that the account known as pension-usdt.eth, described as an Ethereum short trader, recorded heavy losses during the surge and saw its 23-win run end.

The losses occurred as Ethereum jumped from below $2,000 to above $2,300. Prices rose quickly against expectations, triggering forced liquidations of short positions. A short squeeze emerged as those liquidations fed into further buying pressure.

Liquidations across the broader crypto market also swelled sharply. About $2.99 billion, or about 4.13 trillion won, in leveraged positions were liquidated in a day, and the number of affected traders topped 172,000.

Losses were overwhelmingly concentrated in short positions. About $2.74 billion, or about 3.8 trillion won, of total liquidations came from short positions, while long-position liquidations totaled about $256.5 million, or about 35.45 billion won. That means more than 91 percent of the total came from positions betting on a decline.

Ethereum stood at the center of the liquidation wave. After about $1.42 billion, or about 1.96 trillion won, in positions were liquidated in bitcoin, about $1.13 billion, or about 1.56 trillion won, in liquidations also hit Ethereum.

A dynamic formed in which rising prices triggered short liquidations, and forced buying from those liquidations pushed prices higher again, steepening the rally. For pension-usdt.eth, which had built profits by betting on an Ethereum decline, the market’s move in the opposite direction dealt a critical blow.

Technical momentum was also strong. Ethereum posted a large daily candlestick as trading volume surged, and the daily relative strength index (RSI) climbed above 80. After regaining moving averages around $1,875 and $1,935 in turn, it also broke above a price zone around $2,125 seen as a key long-term moving average.

Market attention is now focused on whether Ethereum can turn the $2,125 level into support. If it holds that zone, the rebound could be more likely to extend beyond a simple short squeeze into a trend recovery.

Short-term overheating concerns are also significant. With the RSI above 80 and the market entering an overbought zone on technical measures, a pullback remains possible after the sharp rise. Some analysis also points out that because much of the rally was sparked by short liquidations, upward momentum could weaken if fresh spot buying does not follow.

The episode shows that a high win rate does not eliminate the risks of leveraged investing. Even after posting profits 23 times in a row, a single failed position can severely damage accumulated gains if the market moves sharply in the opposite direction of expectations.

Ultimately, the key to Ethereum’s next direction is whether it can hold support around $2,125. If it maintains that level and additional buying flows in, the uptrend could continue, but if it fails, the view that the surge was a temporary overheating driven by large-scale short liquidations is expected to regain traction.