ETH liquidates over $430M short positions after the biggest daily rally since 2021

Ethereum (ETH) broke out ahead of the entire crypto market, after months of sideways trading under $2,000. The current ETH rally led to over $430M in liquidations for the past 24 hours. 

Ethereum (ETH) showed its ability to rally, adding over 20% in a single day. ETH recovered to $2,445.37, gaining to 0.023 BTC. The strong daily price move, however, directly attacked short positions. ETH recovered as BTC traded at $103,419.00, boosting all other coins and tokens with increased optimism.

As a result, ETH was the leader in short liquidations, with over $430M in the past 24 hours. Short liquidations affected both the centralized market and high-risk single-trader positions on the Hyperliquid perpetual DEX. 

At the same time, whales continued their buying, including from a wallet probably belonging to World Liberty Fi. 

ETH open interest recovers, while wiping out short positions

The liquidations followed a spike in open interest, back above $12B. The recent ETH rally is seen as a potential shift in sentiment and the overall market direction. In the short term, Alphanomics data shows ETH had the most successful day of trading since the 2021 bull market. 

$ETH just had its biggest single-day pump since 2021 yesterday…and the ripple effect is real. ⚡️

Ethereum ecosystem tokens are seeing a surge in activity, with rising DEX volume over the past 24h:

• $PEPE
• $AAVE
• $LINK
• $MOG

Two memes, $PEPE and $MOG, are looking… pic.twitter.com/ca0rdVpPRe

— Alphanomics 💧 (@Alphanomics_io) May 9, 2025

The recent price move is also a rare spike in unison with BTC, as the leading coin broke out to $103,000. Even after the price recovery, BTC dominated 60.4% of the market, while Ethereum dominance was down to 8.4%. 

ETH is yet to prove whether its rally is sustainable and reflects the improvements from the Pectra upgrade. During the recent market recovery, most of the top crypto assets moved into the overbought category, potentially signaling a reversal from the local price peak. 

ETH ecosystem still recovers after a period of low prices

As a result of the ETH rally, the entire Ethereum ecosystem recovered. DeFi tokens and memes also gained inflows, with signs of whales re-entering Ethereum meme positions. ETH value locked returned to over $59B, with significant expansion for Lido and Aave. 

Ethereum on-chain activity also picked up to over 450K daily active wallets. During the rally, the biggest gas burners were general ETH and USDT transfers, burning around 25 ETH in the past 24 hours. 

Ethereum staking still holds over 34M coins, though there is a shift in ownership. Lido saw outflows of 191,872 ETH in the past month, while Binance’s validators saw an inflow of 174,976 ETH. 

The ETH ecosystem is yet to recover its lending liquidity after the recent price dip to the $1,400 range. DeFi lending has around $902M in loans to be liquidated, though at a range under $1,400 and the biggest number of loans at a price level of $853 per ETH. Almost no loans can be found at above $1,500, following previous rapid corrections for ETH.

The low price reflects fears that ETH may dip even lower, despite the current breakout. On the positive side, ETH is expected to return to the $3,000 range and potentially continue its rally as high as $10,000.