ETH faces more than twice the risk on the long side compared to the short side in liquidation squeeze.

Ethereum ETH currently faces an interesting liquidation pattern. According to the latest data, if ETH falls below $3,161, the cumulative long liquidation strength on major CEXs will reach $1.442 billion; conversely, if it breaks through $3,489, short liquidation strength will be only $629 million. Currently, ETH is trading around $3,325, between these two key points—what does this mean?

Market Signals Behind the Liquidation Imbalance

Long and short liquidation strength comparison

The long liquidation strength is 2.3 times that of shorts, reflecting a clear market phenomenon: the current market positions are larger on the long side, with greater leverage exposure. This imbalance usually means that during downward volatility, chain reactions of liquidations will be more intense.

Implications of the current price position

ETH’s current price at $3,325 has a buffer of $164 below the liquidation line at $3,161, accounting for about 4.9% of the current price. While this distance seems sufficient, in markets with high volatility, it’s not entirely safe. Especially considering the recent overall market correction trend—RWA sector led declines of 3.51% in 24 hours, while ETH itself rose 7.23% in 24 hours, but such gains may not be stable in a high-volatility environment.

Market Context and Support Factors

Institutional accumulation providing support

According to the latest information, BitMine has staked over 119,000 ETH, worth approximately $3.36 billion. Continuous accumulation by large institutions often provides price support, at least psychologically boosting market confidence. Vitalik’s related address depositing 330 ETH into Paxos, though small in scale, also reflects active participation by major players.

Upcoming Catalytic Events

On January 15 (tomorrow), BitMine will hold a shareholder vote. If approved, a stock issuance increase (from 500 million to 50 billion shares) will provide the company with more funds to buy ETH, potentially serving as a short-term positive catalyst. Meanwhile, the US Senate Banking Committee will also vote on the CLARITY Act, which involves cryptocurrency regulatory frameworks and could influence overall market sentiment.

Balancing Risks and Opportunities

Risks to watch

• Long liquidation strength far exceeds that of shorts, potentially leading to more intense chain reactions during downward triggers
• The market shows a correction trend overall, with sector divergence
• Leveraged long positions are substantial (e.g., a whale holding 10,800 ETH with 25x leverage longs), and once triggered, liquidations could accelerate declines

Possible support sources

• Ongoing institutional accumulation and staking activities
• Policy and corporate event expectations on January 15
• The $3,161 long liquidation line itself may attract defensive capital

Summary

ETH is currently in a relatively delicate position. The long liquidation strength far exceeds that of shorts, amplifying downside risks. However, ongoing institutional accumulation, upcoming catalysts, and the potential defensive support near the $3,161 liquidation line all provide price support. In the short term, the key is to observe whether the market can remain stable before and after the January 15 events. If it breaks below $3,161, chain liquidation effects could be significant; on the other hand, if it holds and breaks above $3,489, short liquidation pressure will be truly released. Market participants need to have a clear understanding of this asymmetric liquidation pattern.