Bitcoin breaks $70,000 for first time in over two months
Lower US yields, ETF inflows and fresh regulatory hopes push crypto prices higher
Dubai: Bitcoin climbed above $70,000 for the first time in more than two months on Thursday, extending a two-day rally that has brought buyers back into the cryptocurrency market following lower US Treasury yields, fresh institutional inflows and renewed hopes of regulatory progress in Washington.
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The world’s largest cryptocurrency rose about 4.1% to more than $71,900, its highest level since May 31, building on a 7% jump on Wednesday.
The speed of the rebound has also caught traders positioned for further declines. More than $3 billion in cryptocurrency short positions were liquidated over the past 24 hours, after around $1 billion in Bitcoin shorts were wiped out within an hour during Wednesday’s rally.
Other major cryptocurrencies moved higher too, with Ether gaining up to 5.3%, Solana rising about 5% and XRP climbing more than 5.5%.
Why Bitcoin jumped
One of the biggest triggers came from the US bond market, where plans by the Treasury to increase purchases of longer-dated government debt pushed yields lower and initially sent the dollar to a three-month low.
Lower yields can make riskier assets more attractive to investors, while a weaker dollar can also provide support to Bitcoin.
The rally began yesterday after the US Treasury announced larger repurchases of longer-dated debt, which drove a marked decline in long-end yields and improved Bitcoin’s appeal.Konstantinos Chrysikos, Head of Customer Relationship Management at Kudo.com
Further declines in bond yields could continue to support the cryptocurrency, according to Chrysikos, although investors are also watching upcoming US economic data for indications on the direction of interest rates.
ETF money returns
Institutional investors have also returned to Bitcoin after a period of weaker flows.
US-listed spot Bitcoin exchange-traded funds attracted $517 million on Wednesday, their strongest daily inflow since May, according to Chrysikos. That took inflows for the month to around $1.48 billion.
The broader group of 13 US-listed Bitcoin ETFs has received more than $1 billion so far this week, compared with $389.7 million of outflows last week.
Bitcoin whales have also added roughly $2.75 billion worth of the cryptocurrency over the past 60 days.
The renewed buying comes after Bitcoin had spent months under pressure following its peak above $126,000 in October.
Trump meeting lifts regulatory hopes
Sentiment also improved after US President Donald Trump met cryptocurrency industry executives on Wednesday, including representatives from Coinbase Global, Payward and Blockchain.com Group Holdings.
Trump urged the Senate to move forward with the Clarity Act, legislation intended to establish a clearer regulatory structure for the US digital asset market.
The bill failed to reach a vote before the Senate’s August recess following disagreements over ethics provisions, with lawmakers expected to return to it in mid-September.
Chrysikos said expectations of regulatory progress had added to the market’s gains, along with signals that the US administration was considering options that could allow platforms such as Hyperliquid to operate in the country.
Hyperliquid's associated token climbed 23% over 24 hours following those developments.
The market remains focused on the Clarity Act, legislation designed to establish clearer rules for the structure and oversight of the digital asset market in the United StatesAntonio Di Giacomo, Senior Market Analyst at XS.com
The SEC and CFTC are also playing a larger role in shaping rules while congressional negotiations continue.
Traders position for bigger moves
The rally has revived activity in Bitcoin options, with traders building sizeable positions around key price levels.
Deribit data showed $1.5 billion of Bitcoin call options positioned at $70,000, which gain value when the cryptocurrency rises above the specified level. Around $1.4 billion was positioned in puts at $60,000, which benefit from a decline below that price.
The similar size of the two positions points to traders preparing for continued price swings rather than placing all their bets in one direction.
Also Read: Bitcoin hits record high above $124,000
The SEC and CFTC are also playing a larger role in shaping rules while congressional negotiations continue.
Traders position for bigger moves
The rally has revived activity in Bitcoin options, with traders building sizeable positions around key price levels.
Deribit data showed $1.5 billion of Bitcoin call options positioned at $70,000, which gain value when the cryptocurrency rises above the specified level. Around $1.4 billion was positioned in puts at $60,000, which benefit from a decline below that price.
The similar size of the two positions points to traders preparing for continued price swings rather than placing all their bets in one direction.
- With inputs from Bloomberg.
