Representations of Bitcoin are seen in this illustration.
Short sellers of cryptocurrency and blockchain-related stocks have experienced considerable losses since November 6th, as the price of Bitcoin has risen to record highs. This surge is largely attributed to increased optimism that a U.S. President-elect, Donald Trump, will establish a more favorable regulatory framework.
On Monday, crypto short trades appeared poised for further losses as most cryptocurrency-related stocks saw gains in U.S. premarket trading. Coinbase, for example, was up almost 16%, reflecting Bitcoin’s price surge.
According to data analytics firm Ortex, traders who bet against MicroStrategy (MSTR.O), one of Bitcoin’s largest corporate backers, lost over $1.2 billion between November 6th and November 8th. Their losses for the year have exceeded $6 billion.
Combined short-selling losses on crypto-exchange operator Coinbase Global (COIN.O), crypto miners Riot Platforms (RIOT.O) and MARA Holdings (MARA.O), and blockchain-farm operator Bitfarms totaled approximately $1.2 billion as of the close on November 8th.
Bitcoin, the world’s largest cryptocurrency, reached a record high above $82,000 on Monday, experiencing a nearly 19% increase since November 6th. This happened after Republican candidate Trump was re-elected to the presidency.
“Bitcoin speculators are betting on a more clement regulatory environment and have expectations that the authorities may build up a reserve crypto fund, helping lift ongoing demand,” stated Susannah Streeter, head of money and markets at Hargreaves Lansdown.
Investors who bet against iShares Bitcoin Trust exchange-traded funds (IBIT.O), the world’s largest ETF in terms of assets under management, have lost approximately $37 million since November 6th.
During his campaign, Trump expressed support for digital assets, promising to accumulate a national stockpile of Bitcoin and position the United States as the “crypto capital of the planet.”
