The crypto market seems to be finally getting out of the mid-summer doldrums. Bitcoin is 14% up from its Friday close, trading at $38,474 as of 6:48 a.m. ET, a price level not seen since mid-June. All major assets are also bouncing up. Ethereum is back above $2,000, trading at $2,354. Cardano and Dogecoin are the biggest movers in the top 10, up by 10.5% and 15% respectively. The broader market is returning 9.85% over the past 24 hours.
The surge began amid the swirling rumors that Amazon AMZN +1.2% is starting to move into crypto. On June 22, the company published a job posting for a ‘digital currency and blockchain lead’ and this weekend London-based business publication CityAM published an unconfirmed report (based on an anonymous ‘insider’), saying that Amazon could start accepting bitcoin payments “by the end of the year” and is investigating its own token for 2022. It also noted that the company was getting ready to accept payments in bitcoin, ether, cardano, and bitcoin cash.
Blockchain is no stranger to the retail and cloud computing giant – it was a member of the Forbes Blockchain 50 list in 2020 and 2019, offering services such as a toolkit on top of Amazon Web Services for clients to build permissioned blockchains, and is, in fact, the primary host for Infura, a middleware solution for nodes to access the Ethereum blockchain. However, the company has largely kept a firewall between itself and virtual currencies.
The rally gained further steam early Monday due to short squeezes among bitcoin bears. Thousands of traders liquidated $883 million in short positions overnight, according to data from Bybt, a cryptocurrency derivatives trading and information platform. Shorts on bitcoin accounted for $720 million, or 81% of those liquidations.
Bendik Norheim Schei, head of research at Norwegian crypto analytics firm Arcane Research, noted in a message to Forbes that “this was the largest short liquidation (short squeeze) we have recorded to date.” He also speculated that Amazon rumors could have been a major catalyst behind the surge.
It remains unclear whether the rally could be sustained but analysts offer positive outlooks. “As simple as it might be to say, the bottom is in,” writes Maxwell Koopsen, senior copy editor at crypto exchange OKEx. “Now that resistance has formed at $40,000, it may either take substantiation to the claims of Amazon’s intentions or a strong show by the buyers at $34,000–$36,000.”