Bitcoin reclaims $79,000 amid renewed market focus

Bitcoin blew past $79,000 this week, capping a rally that saw the asset gain roughly 20% to 30% in just a few days. The move, which peaked near $79,500 around August 21-22, marks a dramatic reversal from earlier this month when prices were stuck in the low-to-mid $60,000s. The short squeeze heard round the market The primary engine behind this surge was a historic short squeeze. Estimated liquidations exceeded $2.7B as traders who had bet against Bitcoin were forced to cover their positions at increasingly painful prices. Each wave of forced buying pushed prices higher, which triggered more liquidations, which pushed prices higher still. Bitcoin ETF inflows picked up meaningfully during the rally, adding a layer of organic demand on top of the mechanical buying pressure from liquidations. Broader optimism around potential regulatory developments also gave traders a reason to lean bullish rather than fade the move. Treasury policy as a tailwind The US Treasury announced an expansion of its long-term bond buyback program, a move that contributed to lower yields across the curve. When yields drop, risk assets tend to benefit, and crypto tends to be one of the first places that specula...