Bitcoin hits 3-month high of $80,908: What's the reason?
What's the story
Bitcoin has surged past the $80,000 mark for the first time since mid-May, extending a 23% weekly rally, its biggest in nearly three years. The surge comes as optimism returns to the crypto market amid a combination of bullish signals and liquidation of billions in leveraged bets. However, despite this recovery, Bitcoin is still far from its October peak of around $126,000.
Market reaction
Bitcoin's price hits highest point since May 15
Bitcoin's price hit $80,908 today in Asia, its highest since May 15.
The spike comes after a 23% rally in the week ending Sunday.
The cryptocurrency is back in favor as US Treasury Secretary Scott Bessent announced plans to ramp up bond repurchases to lower long-term yields and spark dollar selling.
Market impact
Liquidations in leveraged bets
The announcement from Bessent has triggered a wave of liquidations in leveraged bets, with around $7.2 billion worth across all cryptoassets being liquidated last week, according to Coinglass data.
This was largely due to the short squeeze that analysts say is the main driver of rising prices.
However, there are concerns that this demand may not be sustainable in the long run.
Response
Spot Bitcoin ETFs see strongest weekly inflow in 10 months
The surge in Bitcoin's price has also had a positive impact on the broader crypto market.
Spot Bitcoin exchange-traded funds saw their strongest weekly inflow in 10 months last week, with 13 US-listed funds drawing a net $1.92 billion, the most since early October last year.
The funds also recorded their biggest single day of inflows in over three months, pulling in $606.3 million on August 20.