Bitcoin jumped 8.2% in under 12 hours after the U.S. Treasury doubled its long-end bond buyback operations on Aug. 19, and the rally has since carried the token toward $72,000. A $1.44 billion short squeeze accelerated the move, while spot ETF buying had already built a bid before the announcement hit.
Bitcoin climbed from an intraday low of $64,100 to a peak of $69,500 on Aug. 19, an 8.2% move in under 12 hours, after the U.S. Treasury said it would at least double the size of its long-end liquidity support buyback operations. The next day, the token approached $72,000, up more than 3.5% over 24 hours and 15% since Monday.
Treasury buyback compressed yields
The Treasury said the maximum per-operation size for 10-to-20-year and 20-to-30-year nominal buybacks would rise from $2 billion to at least $4 billion, effective Sep. 9 through Nov. 4, 2026. The 30-year yield fell from a 19-year high of 5.34% to 5.19%, a drop of roughly 15 basis points from its Tuesday peak. The 10-year yield dropped to 4.647%.
Lower long-end yields cut the opportunity cost of holding a zero-yield asset like bitcoin. As a result, institutional allocators pushed further out on the risk curve.
Short squeeze added fuel
Bitcoin's climb past $65,000, then $66,000, then $67,000 pushed leveraged short positions into their liquidation prices. The move fed a short squeeze that reinforced itself, as forced buying pushed the price higher and triggered further liquidations. Short liquidations totaled $1.44 billion across major exchanges within 24 hours, with $1.29 billion closing inside a single hour, and more than 110,000 traders were liquidated in total. The largest single liquidation was a $32 million ETH-USD position on Bitget.
Spot Bitcoin ETFs had already built a bid before the catalyst hit: U.S. funds recorded $487 million in net inflows across Aug. 17 and 18, with BlackRock's IBIT taking in $143.6 million on Aug. 18 alone.
Bitcoin reclaims key technical levels
By Thursday, bitcoin had moved above its short-term holder cost basis of $67,138 and its 200-day moving average of $68,969, according to CoinDesk. AMBCrypto reported the token also reclaimed the 200-day moving average for the first time since dropping below $100,000 last November. The next level in view is the true market mean at $75,689, which would need to break for a broader trend reversal to be confirmed.
Crypto-related equities rallied alongside bitcoin. Strategy, the largest corporate bitcoin holder, gained 13% on Wednesday and rose a further 10% in pre-market trading Thursday, while Coinbase and MARA Holdings advanced too.
Sources: crypto.news, CoinDesk, AMBCrypto
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