Bitcoin Adds Then Loses Nearly $100B in Market Value Within Hours

Bitcoin saw intense volatility on December 17, moving almost $100 billion in market value over a short period. Its price surged by over $3,000 in less than an hour, then returned to roughly $86,000.

The event is striking because it occurred without major news, pointing to leverage, concentrated positions, and delicate liquidity as the likely causes.

What Caused a Sudden Surge?

Bitcoin rose from around $87,000 toward $90,000, a key psychological and technical resistance level. As the price approached this area, traders with short positions began closing them, which added buying pressure and pushed the price closer to $90,000. After reaching this level, the price faced resistance and started to pull back.

Data from exchanges shows that about $120 million in short positions were liquidated during this move. This is a typical short squeeze, where forced buying drives the price above normal demand. Still, the market’s structure remained weak despite the gains.

Even after Bitcoin went past $89,000, the rally had little support. Most traders followed momentum, not fundamentals, leaving the market open to a quick drop.

Long Liquidations Reversed Gains

When Bitcoin briefly went over $90,000, numerous new traders opened leveraged long positions, expecting the upward trend to persist. The momentum faded quickly because genuine buying pressure was limited.

🚨 BITCOIN IS BEING MANIPULATED, AND I HAVE SOLID PROOF!!!

Everyone’s talking about how Bitcoin went up $3,000 and then down $4,000 in minutes.

Everyone’s posting about it…

but nobody seems to understand what actually happened.

You need to look at the flows, not the chart.… pic.twitter.com/IHCXtx3sUF

— NoLimit (@NoLimitGains) December 17, 2025

As key support levels failed, long positions became vulnerable. Exchanges automatically liquidated over $200 million in long trades, causing a chain reaction that wiped out gains. The drop was made faster and bigger by the leverage that had pushed the price up.

This shows how crypto markets can exaggerate moves in both directions. Unlike regular stocks, Bitcoin can swing sharply even when fundamentals stay the same. Here, leverage caused the market to move against itself.

Current Market Conditions

Data from Binance and OKX shows a fragile setup. On Binance, top accounts were mostly long before the spike, but their position sizes were small, showing limited confidence. On OKX, ratios changed quickly after volatility, showing fast moves by bigger traders.

Crowded positions, thin liquidity, and high leverage make Bitcoin prone to sudden swings. Market makers like Wintermute moved Bitcoin between exchanges, but this is normal hedging and liquidity work, not manipulation.

For investors, this highlights that even during quiet periods, Bitcoin can move quickly due to trading dynamics rather than news.

Key Considerations for Investors

This event highlights the dangers of leveraged markets. Liquidity can vanish quickly, and many positions in the same area can magnify moves.

It’s important for traders and investors to separate short-term volatility from real value. Bitcoin’s long-term value is still steady. The recent swings were caused by temporary imbalances and weak market conditions. Similar events are possible until leverage and positioning normalize.