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Bitcoin (BTC) short liquidations hit their highest in almost one month as it hit $64,500 on Monday, new data reveals.Key points:Bitcoin passed $64,000 thanks to a short squeeze on derivatives markets, CryptoQuant says.An ongoing downward funding-rate reset from 0.006% to 0.003% over 24 hours could mean further short squeezes.The absence of spot demand raises doubts whether the upside is sustainable after a week of $267.2 million in net ETF outflows.Bitcoin short liquidations near one-month high BTC/USD rallied after Sunday’s weekly close, gaining up to 3% on Monday to top out at one-week highs of $64,550 on Bitstamp. BTC/USD one-hour chart. Source: Cointelegraph/TradingViewExamining the impetus behind the latest BTC price gains, onchain analytics platform CryptoQuant pointed to illiquid markets and funding-rate imbalances among exchanges.Before rebounding on Monday, BTC circled near $62,750. Around this level, funding rates between exchanges began to diverge. Shorts were dominant on major platforms such as Binance, Bybit, OKX and Deribit, while the funding rate on HTX briefly spiked to 0.05%.Funding rates refer to periodic payments exchanged by long and short traders on Bitcoin derivatives markets in order to maintain their positions. Positive aggregate funding rates show that long traders are actively paying shorts, with the reverse true for negative funding rates.“This crowded short positioning served as the primary catalyst, fueling a short squeeze that drove prices higher,” CryptoQuant continued.BTC/USD one-hour chart with exchange funding-rate data (screenshot). Source: CryptoQuantData puts total Bitcoin short liquidations at 637 BTC for Monday, the largest single-day tally since July 21.Describing the event as a “low-volume liquidity trap,” CryptoQuant nonetheless suggested that the market could see more short squeezes next, with funding rates already declining again as traders increase short exposure.Bitcoin short liquidations. Source: CryptoQuantCrucial spot demand remains absentPreviously, Cointelegraph reported that Bitcoin futures markets accounted for the majority of trading volume in the current range, with spot traders broadly uninterested. Related: BTC price loses 200-week trend line as 2022 repeats: Five things to know in Bitcoin this weekIn further analysis on Monday, CryptoQuant called the lack of spot demand the primary hurdle to sustained upside, alongside the lack of inflows to the US spot Bitcoin exchange-traded funds (ETFs).“A break below $60K alongside rising exchange inflows would weaken the structure and increase downside risk toward $50K. Selling pressure is cooling, but demand still needs to return,” it commented.Recent buyers who remain underwater on their BTC allocation have helped cement the current trading range. Short-term holders — wallets holding a UTXO for less than 155 days — have their cost basis at around $68,700, reinforcing that level as resistance.