Bitcoin Jumps 26% After Major Short Squeeze as Spot ETFs Pull In $2.23B

Bitcoin (BTC) has climbed about 26% from its mid-August low, with the rebound amplified by a wave of short liquidations. Glassnode said the Aug. 19 move marked the largest single-day liquidation event since 2019, with shorts making up the bulk of forced closures on major centralized exchanges. The total likely ran higher, as the dataset does not include Hyperliquid. Glassnode said the squeeze flushed a large share of liquidation liquidity around BTC. It now sees more short-liquidation levels sitting above the market and a smaller pocket of long-liquidation risk below. The rally also drew support from spot demand. U.S. spot Bitcoin ETFs logged $2.23 billion in net inflows over seven consecutive days, with no outflow sessions, posting their strongest weekly intake of 2026. The stretch included the biggest ETF creation day since mid-January. On the holder side, BTC continued to drift away from exchanges as wallet cohorts adjusted positions. Entities holding 1,000–10,000 BTC cut balances by 50,500 BTC since June 30. Entities holding more than 100,000 BTC added 59,100 BTC, a category that includes exchanges, custodians and ETF-related wallets. During the squeeze week, the custody cohort added 31,500 BTC. Glassnode said this was comparable to weekly ETF creations in scale, though the data does not indicate those same coins flowed directly into ETFs. Glassnode's 30-day trend score also shows every wallet-size cohort shifting into net accumulation, which the firm described as the most persistent broad-based buying since late 2024. Despite the price recovery, leverage has not rebuilt as quickly. Futures open interest is down 11% in BTC terms. Perpetual funding stayed near neutral before turning negative, pointing to limited pressure from fresh leveraged longs. On-chain positioning suggests recent buyers are sitting below the current price, while long-term holders represent the main supply zone above it. BTC is trading between these groups, setting up a key demand test. Glassnode noted multiple signals implying a similar overhead supply region, including cost-basis levels, ask-side liquidity, options positioning and remaining liquidation clusters. A sustained push through that area would indicate whether buyers can absorb available supply.