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Bitcoin surged sharply after August 19, breaking out of a roughly six-week range between $62,000 and $66,900 to briefly touch $79,400. CryptoQuant founder and CEO Ki Young Ju stated that “the bear market is nearly over,” but market data supporting this view coexists with signals that warrant continued caution. The rally was driven by a confluence of factors: improving spot and perpetual futures demand, approximately $1.918 billion in net inflows into U.S. spot Bitcoin ETFs over five trading days, reclaiming of the Short-Term Holder Cost Basis and True Market Mean, declining long-term yields and a weaker dollar following the U.S. Treasury’s expansion of long-dated bond buybacks, and massive short liquidations. However, spot taker CVD remains in neutral territory, meaning aggressive spot buying has not yet been confirmed as dominant. During the same period, U.S. equities fell amid persistently high real yields and rising oil prices, creating an unusual divergence from Bitcoin. The key focus going forward is whether Bitcoin can hold the $75,000–$76,000 level and whether ETF inflows and spot demand remain sustained.
Key Elements
Bitcoin surged sharply after August 19, breaking out of a roughly six-week range between $62,000 and $66,900 to briefly touch $79,400. The weekly gain reached approximately 24%, and in yen terms, Bitcoin briefly hit around ¥12.6 million (approximately $79,000).
Regarding this rally, Ki Young Ju, founder and CEO of on-chain analytics firm CryptoQuant, stated on August 21: “When this kind of rally occurs in a bear market, it typically signals that a bottom has been put in. Pullbacks are possible, but I believe the bearish phase is largely over.” However, the market is simultaneously seeing data that supports this assessment and data that calls for continued caution.
Multiple Demand Improvements Behind the Range Breakout
This rally saw nearly simultaneous improvements in spot demand, perpetual futures demand, inflows into U.S. spot Bitcoin ETFs, recovery of key on-chain cost bases, declining long-term yields and a weaker dollar, and massive short position unwinding.
Ki himself noted on August 20 that “for the first time since the all-time high in October 2025, Bitcoin demand has turned positive in both spot and perpetual futures,” and he shifted his view to a bear market end the following day. This statement was not based merely on chart reading but appears to reflect structural changes in demand observed by CryptoQuant.
Particularly notable was the reclaiming of on-chain cost bases. As of August 19, the Short-Term Holder Cost Basis stood at approximately $68,500, while the True Market Mean—a key cost basis for the overall market—was around $75,800. At the time, Bitcoin’s price was below both levels, suggesting residual selling pressure.
Yet just two days later, Bitcoin surged to $79,400. This meant reclaiming not only the average acquisition price of short-term holders but also the key cost basis for the entire market in one swift move. One of the critical conditions for escaping the bearish structure appears to have been met. However, since on-chain metrics like the True Market Mean are not fixed prices but shift daily, whether price can establish itself above these levels going forward will be crucial.
Approximately $1.9 Billion in ETF Inflows, but Spot Buying Remains “Neutral”
Short squeezes played a major role in this surge. When Bitcoin broke out of its range, approximately $3 billion (roughly ¥480 billion) in short positions were liquidated across crypto markets within 24 hours. Bitcoin alone accounted for approximately $1.67 billion (roughly ¥270 billion), suggesting that forced buybacks by short sellers significantly amplified the acceleration from the mid-$60,000s into the $70,000s.
A distinguishing feature of this rally, however, is that capital flowed not only into derivatives but also into spot markets. U.S. spot Bitcoin ETFs recorded the following net inflows over the five trading days from August 17 to August 21:
| Date | Net Inflows |
|---|---|
| August 17 | Approximately $298 million (roughly ¥47 billion) |
| August 18 | Approximately $189 million (roughly ¥30 billion) |
| August 19 | Approximately $517 million (roughly ¥82 billion) |
| August 20 | Approximately $606 million (roughly ¥96 billion) |
| August 21 | Approximately $308 million (roughly ¥49 billion) |
Note: Net inflows into U.S. spot Bitcoin ETFs. Five-trading-day total of approximately $1.918 billion (roughly ¥300 billion).
Buybacks from short liquidations are a temporary supply-demand factor, but ETF inflows represent genuine demand that translates into spot Bitcoin purchases. This rally likely resulted from a confluence of factors: shifting macro conditions, range breakout, short squeezes, and follow-through from ETF and spot demand.
That said, spot market data paints a more cautious picture. CryptoQuant’s spot taker CVD (90-day cumulative volume delta)—an indicator of whether aggressive market buys or sells are dominant in the spot market—has returned to “neutral” territory, neither buy-dominant nor sell-dominant. Despite Bitcoin’s rise into the $70,000s, aggressive buyers are not yet overwhelmingly dominant in the spot market.
In other words, while short buybacks amplified the rally, aggressive spot buying remains in neutral territory. The focus from here is not just whether price continues higher, but whether this indicator shifts decisively back into buy-dominant territory.
Not “QE Resumption” but Treasury Liquidity Support
The macro environment in the U.S. also shifted during this rally. On August 19, the U.S. Treasury Department announced plans to raise the per-operation cap on liquidity-support buybacks of 10–20 year and 20–30 year long-dated Treasuries from $2 billion (roughly ¥320 billion) to at least $4 billion (roughly ¥640 billion).
This led to lower long-term yields and a weaker dollar, lifting risk assets including Bitcoin. However, the interpretation circulating on some social media that “the U.S. has resumed quantitative easing (QE)” is not accurate. This measure is not QE by the Federal Reserve but rather a Treasury Department liquidity support and debt management operation.
While short-term effects such as lower long-term yields, a weaker dollar, easing financial conditions, and tailwinds for risk assets are plausible, this does not confirm a policy shift toward full-scale monetary easing. This macro development may have been a catalyst for Bitcoin’s rally, but it does not guarantee a bull market.
An “Unusual Divergence” Coinciding with Equity Weakness
During the same period as Bitcoin’s surge, the S&P 500 and Nasdaq declined. Selling pressure was particularly intense in technology stocks, especially AI and semiconductor names. Historically, Bitcoin and U.S. growth stocks have tended to move in similar directions as risk assets.
This was not a simple risk-on move. Bitcoin benefited from a concentration of crypto-specific catalysts: U.S. Treasury policy, dollar weakness, expectations for crypto regulatory clarity, ETF inflows, and short squeezes. Meanwhile, equity markets were weighed down by high real yields, rising oil prices, stretched AI stock valuations, and concerns about consumer spending.
On the crypto-specific front, President Trump’s meeting with crypto industry participants—where he urged Congress to advance the CLARITY Act, a market structure bill—provided an additional tailwind. The legislation aims to clarify jurisdictional boundaries between the U.S. Securities and Exchange Commission (SEC) and the U.S. Commodity Futures Trading Commission (CFTC) for crypto assets, establishing clearer rules. While it has not yet been enacted, the mere possibility of reduced regulatory uncertainty was a positive factor.
In equity markets, the 10-year real yield hovering in the low-2% range poses a significant problem, particularly for high-P/E companies in AI, semiconductors, and software. Since these companies’ stock prices are valued by discounting future earnings to present value, higher real yields tend to reduce theoretical enterprise value. Concerns about reaccelerating inflation from rising oil prices and worries about consumer-facing companies compounded the pressure.
However, the current decline in U.S. equities should not immediately be interpreted as a financial crisis or a broad risk-off event. The VIX remains at relatively low levels, and credit spreads on U.S. high-yield bonds show no signs of sharp deterioration. Within the equity market, capital is rotating away from AI and semiconductors toward energy, healthcare, and consumer staples. What is occurring is more naturally understood as a rotation from high-valuation growth stocks into sectors better positioned to withstand the current rate and inflation environment, rather than a wholesale retreat from equities.
Past Forecast Revisions and the Case for Caution on “Bottom Confirmation”
Ki Young Ju is a highly influential figure in on-chain analysis, but his past market forecasts should not be treated as direct trading signals. In March 2025, he declared the end of Bitcoin’s bull cycle and predicted “bearish or sideways conditions for the next 6–12 months,” only to acknowledge his error and revise his view approximately two months later. Furthermore, in May 2026, he had suggested the bear market could persist into early 2027.
This latest statement is not a case of “I predicted $60,000 as the bottom all along.” Rather, it should be viewed as a revision of his own bearish scenario in response to rapidly changing market data. This speaks less to Ki’s forecasting ability and more to the magnitude of change in the demand data CryptoQuant observes.
Nevertheless, there are reasons why a confirmed bottom cannot yet be declared. In spring 2026, Bitcoin also rebounded sharply from around $60,000 to near $82,000. That rally was subsequently assessed not as a structural trend reversal but as a bear market bounce. A 20–30% rally within a bear market does not, in itself, prove a bottom.
Is this time truly different from May? The answer will be determined not by the magnitude of the rally, but by whether spot demand, ETF flows, on-chain profit structure, and key cost bases can be sustained.
Key Focus: The $75,000–$76,000 Zone
The $75,000–$76,000 area warrants particular attention going forward. This is close to the True Market Mean of approximately $75,800 as of August 19. Holding above this reclaimed level would provide important evidence of a shift away from the bearish structure.
The next focal points are whether Bitcoin can break above the recent high of $79,400–$80,000 and then push through the $82,000–$83,000 area—where May’s rally stalled—with spot demand confirmation. Conversely, a clear break below the Short-Term Holder Cost Basis around $68,500 would warrant caution about a return to the bearish structure.
If Bitcoin can hold $75,000–$76,000, break above $80,000, and then clear $82,000–$83,000, the likelihood that this rally differs from the May 2026 bear market bounce would increase further.
Ki Young Ju’s statement that “the bear market is nearly over” carries far stronger data backing than his previous calls. Particularly important is the simultaneous occurrence of on-chain demand reversal, approximately $1.918 billion (roughly ¥300 billion) in ETF net inflows, reclaiming of key cost bases, improving macro conditions, and the unwinding of extreme bearish positioning.
On the other hand, this rally included one of the largest short squeezes in history, and complete seller exhaustion still needs to be confirmed with the latest data. At this point, the most reasonable assessment is that while the probability that approximately $60,000 was the final bottom has risen significantly, the end of the bear market has not been fully confirmed.
Going forward, it will be necessary to track not just price but also ETF net inflows, the Coinbase premium, apparent spot demand, and the realized profit/loss ratio. If these metrics continue to improve while Bitcoin establishes itself above $75,000–$76,000, the likelihood that this rally represents not merely a bear market bounce but a genuine regime shift in the 2026 Bitcoin market would increase substantially.
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Source: finance.biggo.com