Bitcoin pulled back to $78,000 after breaking above $80,000, triggering $324.4 million in forced liquidations in the crypto market in a day.

On Aug. 26, blockchain outlet CryptoSlate reported that most of the liquidations came from long positions, reversing last week’s pattern in which short liquidations amplified a rally.

CoinGlass data showed about 80,000 liquidations over the past 24 hours. Of total losses, about $270 million came from long positions, and on Binance a $11.91 million bitcoin position was the largest single liquidation. By asset, bitcoin long liquidations were about $109 million and ethereum long liquidations were about $70 million. XRP and Zcash (ZEC) long liquidations totaled about $16 million and $11 million, respectively.

Market attention is focused less on the size of the liquidations than on the change in positioning. When bitcoin broke above the top of its range last week, investors betting on a decline were liquidated in large numbers. Market maker Wintermute analyzed that about 92 percent of total liquidations were short positions. Inflows of $2.6 billion into crypto investment products also widened the gains.

More recently, leverage has been rebuilding quickly, centered on long positions. As exchange-traded fund (ETF) inflows stabilized and bitcoin held the bottom of its range, investors shifted to a bullish stance, but Wintermute warned that the pace of the position shift is similar to the squeeze period. That means that after the upside momentum from short covering is exhausted, additional price gains need to be supported by real buying interest that flows in at higher prices as well.

Joao Wedson (주앙 웨드슨), chief executive of Alphractal, also assessed that the risk of a bitcoin long squeeze is growing. He noted that as long concentration has increased, funding rates have remained positive across multiple exchanges. A positive funding rate means leveraged long holders pay a fee to short holders, showing the futures market is tilted toward further gains. If prices fall quickly in such a situation, long liquidations could cascade and intensify downward pressure.

This correction is interpreted as an early signal of that move. Some also say that as bitcoin recovered around $79,000, the liquidation shock has not spread into a clear trend reversal. A key question is how much spot and ETF demand can absorb profit-taking above $80,000.

Spot bitcoin ETFs have drawn more than $2.5 billion in net inflows over the past 7 consecutive trading sessions. Those inflows were one of the factors that lifted bitcoin from about $62,000 in early August to $80,000 at one point. Wintermute viewed ETF flows going forward as a check on whether this rally has a firmer base of spot demand. Conversely, if weekly ETF flows turn to net outflows and bitcoin closes again below $67,000, its prior range, investors could shift to a more cautious stance.

On-chain and supply-demand indicators have not fully broken the bullish case. CryptoQuant tallied that total bitcoin demand rose by about 170,000 BTC over the past 30 days. A pattern in which spot and futures demand rise together often appears during strong rallies, but if futures exposure grows faster than spot buying, there remains room for the market to be shaken.

Also scheduled are an expansion of the U.S. Treasury’s long-term bond purchases on Sept. 9, a final vote on the Clarity bill on Sept. 15, and the U.S. Federal Reserve’s monetary policy decision on Sept. 16. Ultimately, whether this break below $80,000 ends as a correction that shakes out excessive leverage or becomes the start of a broader shift to selling is expected to depend on whether spot buying and ETF inflows continue.