Bitcoin touched roughly $79,400 overnight before settling near $77,000 Friday, its best week since 2023. Spot ETF buying, a softer regulatory outlook in Washington and a wave of short liquidations drove the move, though Bitget CEO Gracy Chen expects the price to end the year close to where it stands now.
Bitcoin traded around $77,000 Friday after touching roughly $79,400 overnight, capping a run that is up about 24% since Monday and marks its best week since 2023.
Institutional buying, an improving macro backdrop and a friendlier regulatory outlook in Washington collided with billions of dollars in short liquidations to push the price higher. Lacie Zhang, a research analyst at Bitget Wallet, said the move looks like "a convergence of three forces."
Spot ETFs and short covering fuel demand
The third force, spot demand, showed up in renewed spot bitcoin ETF buying. U.S. funds took in roughly $517 million on August 19 and about $606 million on August 20, extending a run that had already pulled in $853.5 million over five consecutive sessions earlier this month. Julio Moreno of CoinShares said ETFs purchased roughly 7,500 BTC in a single day, their highest daily level since April, pointing to the Treasury's buyback announcement and Trump's remarks about the government potentially buying Bitcoin as the catalyst.
Washington eases the regulatory outlook
Trump this week called on Congress to pass a "fair version" of the Clarity Act during a White House meeting with crypto and finance executives. The bill would set a federal regulatory framework for digital assets and define the respective roles of the CFTC and SEC. It remains stalled in Congress, with the Senate expected to return to it in September, while CFTC Chair Michael S. Selig said Thursday he directed staff to explore crypto market-structure rules under the agency's existing authority.
Short sellers get squeezed
The shift in demand caught traders betting against Bitcoin exposed. Zhang estimated more than $4 billion in crypto shorts were liquidated over two to three days, including roughly $2.7 billion during one 24-hour period and another $1.2 billion the following day — one of the largest forced short squeezes in recent crypto history.
Bitget's CEO expects a flatter year-end
Not everyone reads the rally as a turning point. Bitget CEO Gracy Chen said predicting whether Bitcoin finishes the year above or below $70,000 is difficult, citing interest rates and broader macro conditions. She said Bitcoin could finish the year $10,000 to $20,000 above or below current levels, calling that her more responsible forecast.
Chen also doubts the U.S. government will start buying Bitcoin for its reserve before Trump's term ends, calling such a move unlikely within the next two years. The government currently holds an estimated 328,372 BTC, according to BitcoinTreasuries.NET, mostly from law enforcement seizures rather than direct purchases.
Sources: Decrypt, Cointelegraph.com News
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