Bitcoin has staged a powerful rebound, climbing above the $76,000 mark during early European trading on Friday after first reclaiming the psychologically important $70,000 level. The cryptocurrency traded around $76,478, extending a rally that began after the US Treasury expanded long-dated bond buybacks and Washington delivered fresh crypto-friendly policy signals.
The initial leg of the move was heavily mechanical. According to CoinGlass data, approximately $2.75 billion of Bitcoin short positions were liquidated on Wednesday, forcing bearish traders to buy back coins as prices surged. Gideon Hyams, chairman and co-founder of STS Digital, told The Block: "Squeezes start rallies, but they don't sustain them." He argued that falling long-end Treasury yields, returning ETF flows, and a clearer regulatory path in Washington gave the move more support than forced buying alone.
US spot Bitcoin ETFs attracted $517.19 million on August 19, their largest daily net inflow since May 4, according to SoSoValue data. The following session was calmer, with roughly $38.6 million in net inflows on August 20, extending the positive run but underscoring how unusual the half-billion-dollar surge was. The slowdown is not inherently bearish, but analysts emphasize that consistency of inflows will be the key to confirming a sustainable rally.
On-chain indicators are also becoming more constructive. CryptoQuant founder Ki Young Ju noted that Bitcoin demand in both spot and perpetual-futures markets turned positive simultaneously for the first time since the October 2025 all-time high. However, Ju urged patience, saying the improvement remains modest and would need to persist for roughly another month before it would be reasonable to conclude that the bear market has ended and a new bull cycle has begun.
CryptoQuant head of research Julio Moreno offered a similar caution to Decrypt, stating that the rally could remain sustainable if spot-demand growth continues after the initial macro catalysts fade, but noting that CryptoQuant's broader bull indicators have not yet confirmed a new regime. The alignment of spot and perpetual demand is a historically bullish signal, as it reflects genuine buying interest rather than speculative leverage alone, yet sustained price action will be essential to confirming a new bullish phase.
