A retail-driven short squeeze pushed bankrupt cryptocurrency lender Celsius Network‘s (CRYPTO: CEL) native token up 25% on Monday.
What Happened: CEL rallied from $1.44 to a high of $1.82 over 24 hours, as per data from Benzinga Pro. The token was up 21.89% against Bitcoin (CRYPTO: BTC) and 19.9% against Ethereum (CRYPTO: ETH) at press time.
Crypto asset managers largely attributed the rally to a short-squeeze orchestrated by retail traders on Twitter Inc (NYSE:TWTR).
Good Morning #CelShortSqueeze Gang
Are you guys buying $CEL and making money?! https://t.co/XQjqOGCUsb pic.twitter.com/zYJJAMzaYQ
— WSB Crypto Mod (@traderrocko) August 8, 2022
Another kamikaze spot purchase on @FTX_Official for the community led #Celshortsqueeze.
I am not stopping until it hits $100.
I don’t care about the money. pic.twitter.com/4kvi28FBkY
— Jono Spears (@Bitcoinfinity) August 8, 2022
The asset’s price surge led to 300,000 CEL short positions closed on FTX, CoinDesk reported. Data from CoinGlass showed that $780,000 CEL short positions were liquidated over the last 24 hours.
“Since the circulating supply is very small, it is technically possible to create a short squeeze, although the impact in the overall market could be very limited and hard to sustain over a longer period of time,” Hashdex’s chief product and technology officer, Samir Kerbage, told CoinDesk.
Celsius declared bankruptcy last month after freezing withdrawals and halting deposits. More than 80% of CEL tokens are locked, making it a low-liquidity token and considerably harder for short traders to buy CEL on the market to cover their positions.
In June, CEL rallied 100% in a single-day in another retail driven short squeeze.
