Bitcoin’s 20% Short

Bitcoin’s 20% Short-Squeeze Surge Could Already Be Over

• BTC-USD

Quick Read

• Bitcoin surged 20% in under 48 hours as $3.3 billion in forced short liquidations drove bears to buy, not genuine investor demand.

• Short liquidations dropped 60% in 24 hours, leaving spot Bitcoin ETFs to sustain the move. Those ETFs had pulled $606 million on Thursday.

• Trump urged Congress to pass the Digital Asset Market Clarity Act, with a Senate vote set for Sept. 15 adding regulatory tailwind.

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Bitcoin (CRYPTO:BTC) has gone from a market dominated by hesitation to one dominated by forced buying in less than 48 hours. After spending roughly six weeks trapped in a narrow trading range, Bitcoin jumped from about $64,500 on Wednesday to around $77,050 today — a gain of roughly 20%. 

The move was not driven by one giant wave of new investors. It began with a macroeconomic catalyst and was then turbocharged by one of crypto’s most powerful mechanisms: a short squeeze. The question now is whether genuine spot demand can keep the rally alive after leveraged bears have largely been cleared out.

Treasury Liquidity Lit The Fuse

U.S. Treasury announced plans to double the maximum size of certain long-dated bond buyback operations to $4 billion, a move intended to improve Treasury-market liquidity. Treasury’s August 2026 quarterly refunding materials show plans for up to $38 billion of off-the-run securities purchases during the quarter.

The announcement initially pushed bond yields lower and weakened the dollar, creating a friendlier backdrop for scarce, risk-sensitive assets such as Bitcoin. But the macro boost was only the spark.

President Trump added another catalyst on Aug. 19, urging Congress to pass the Digital Asset Market Clarity Act during a White House meeting with cryptocurrency executives. Reuters reported that the legislation would establish clearer definitions for digital assets and determine which federal agencies oversee them. A Senate vote is scheduled for Sept. 15.

That combination was enough to push Bitcoin through resistance that had held for weeks.

24/7 Wall St.

Bears were crushed as Bitcoin rocketed to $77,000—but the ‘squeeze fuel’ is running dry. See why the next leg up depends entirely on a $500 million daily ETF gamble. © 24/7 Wall St.

Then The Bears Became The Buyers

This is where the rally becomes more about market mechanics. According to CoinGlass data, more than $3.1 billion of crypto short positions were liquidated as Bitcoin broke higher. In a short squeeze, traders betting on falling prices are forced to buy the asset to close their positions. Those purchases push prices higher, triggering more liquidations and creating a self-reinforcing loop.

Source: finance.yahoo.com