Crypto Market Rally Liquidates $639M in Short Positions

The cryptocurrency market experienced a sharp rally, with Bitcoin and most major digital assets seeing significant gains, catching many traders who had bet against the market off guard. This surge was fueled by strong inflows into U.S. spot Bitcoin ETFs and a broader increase in risk appetite, partly driven by optimism over de-escalating U.S.-China trade tensions and President Trump's softer stance on tariffs. As a result, over $600 million in short positions were liquidated, prompting many traders to reassess risk management strategies amidst heightened volatility. The rally was mirrored in U.S. equities, while gold retreated from record highs as investor sentiment improved. Despite these gains, the market remains in a 'Bitcoin season,' with altcoins also seeing notable price increases but still lagging behind Bitcoin's dominance. The ongoing conflict between President Trump and the Federal Reserve over interest rate policy and tariffs further contributed to market turbulence and investor repositioning.