Despite the news that Binance will delist the token on May 2, Alpaca Finance shocked the cryptocurrency market with a 1,100% price increase in the last week.

The Alpaca Finance (ALPACA) token has seen a staggering 1,100% price increase in the last week, which is surprising considering Binance will delist the token on May 2.

The Alpaca Finance (ALPACA) token has seen a staggering 1,100% price increase in the last week, which is surprising considering Binance will delist the token on May 2.

Binance announced the removal of ALPACA and three other tokens from its platform on Apr.24 following a routine evaluation. The exchange cited factors such as low trading volume and developer inactivity.

Binance announced the removal of ALPACA and three other tokens from its platform on Apr.24 following a routine evaluation. The exchange cited factors such as low trading volume and developer inactivity.

ALPACA spot trading pairs will be disabled on May 2, while deposits and withdrawals were phased out in the days after the announcement. Usually, tokens decrease in value after delisting news but ALPACA experienced the opposite.

ALPACA spot trading pairs will be disabled on May 2, while deposits and withdrawals were phased out in the days after the announcement. Usually, tokens decrease in value after delisting news but ALPACA experienced the opposite.

After briefly dropping in response to the news, ALPACA surged by as much as 2,300% in just a few days, jumping from $0.029 to a peak of $1.47—a 60x increase on some trading pairs.

After briefly dropping in response to the news, ALPACA surged by as much as 2,300% in just a few days, jumping from $0.029 to a peak of $1.47—a 60x increase on some trading pairs.

ALPACA is currently trading at $0.53, down 40% in the last 24 hours but still up 1,100% over the past week, according to CoinGecko data.

The rally appears to have been driven by a short squeeze. Following the delisting news, many traders opened short positions expecting the price to collapse. However, they were forced to buy back the token to cover losses when ALPACA unexpectedly surged, which caused the price to rise even further.

The rally appears to have been driven by a short squeeze. Following the delisting news, many traders opened short positions expecting the price to collapse. However, they were forced to buy back the token to cover losses when ALPACA unexpectedly surged, which caused the price to rise even further.

The squeeze was further tightened when Binance modified its funding rates. The funding cap was increased from ±2% to ±4%, and settlement intervals were reduced from four hours to one hour, which resulted in higher costs for short sellers. This made holding bearish positions expensive and risky.

Meanwhile, ALPACA’s supply tightened. A supply shock was caused by the team’s suspension of new token issuance and the burning of about 35 million tokens, or 18.6% of the maximum supply.

Meanwhile, ALPACA’s supply tightened. A supply shock was caused by the team’s suspension of new token issuance and the burning of about 35 million tokens, or 18.6% of the maximum supply.

Some on-chain observers suspect market manipulation. Positions totaling more than $50 million, including $43 million from short sellers, were liquidated. It’s possible that coordinated whale activity contributed to price increases which caught leveraged traders off guard.

The situation was likened to the Gamestop short squeeze of 2021, in which institutional short sellers were outbid by retail traders. However, there are still concerns about how long the ALPACA pump can last and what will happen after Binance’s final delisting.