Bitcoin surged over 25% to top $78,500, fueled by a massive short squeeze that liquidated up to $4 billion in bearish positions. The rally was catalyzed by the US Treasury's decision to double its long-term bond buybacks to $4 billion, which successfully cooled soaring 30-year yields. Momentum increased after President Donald Trump hosted crypto executives at the White House to push for the CLARITY Act, alongside $650 million in weekly spot ETF inflows.
Bitcoin price surge
- ▪Bitcoin surged approximately 25% over the week ending August 21, 2026, reaching an intraday high of $79,500 on Friday, August 21, 2026.
- ▪Bitcoin ended trading on Friday, August 21, 2026, at $76,943.90, representing a 6% daily gain and a 22% weekly gain.
- ▪Despite the August 2026 rally, Bitcoin remained well below its 2026 high of $94,820 set in mid-January and its all-time high of approximately $126,000 reached in October 2025.
Crypto short squeeze liquidations
- ▪Bitcoin short positions accounted for approximately $1.65 billion to $1.67 billion of the total liquidations, while Ethereum short positions accounted for $1.14 billion.
- ▪The short squeeze was preceded by a six-week consolidation period where Bitcoin traded between $62,000 and $66,900, driving the long-short ratio down to 0.835.
- ▪The cryptocurrency market rally triggered the liquidation of approximately $3 billion to $4 billion in bearish short positions over a 48-hour period ending August 21, 2026.
US Treasury bond buyback expansion
- ▪US Treasury Secretary Scott Bessent stated on Thursday, August 20, 2026, that Washington would consider increasing the bond buybacks even further if yields climbed back.
- ▪Following the US Treasury buyback announcement, the 30-year US Treasury bond yield fell from a 19-year high of 5.337% to approximately 5.19%.
- ▪The US Department of the Treasury announced it will double its long-term government bond buybacks starting in September 2026, increasing from $2 billion to at least $4 billion per operation.
Trump crypto industry meeting
- ▪During the White House summit, President Donald Trump urged Congress to pass a fair version of the stalled Digital Asset Market CLARITY Act.
- ▪President Donald Trump hosted senior executives from Coinbase, Ripple, Gemini, and other crypto firms at the White House on Wednesday, August 19, 2026, to discuss digital asset regulation.
- ▪President Donald Trump stated that the Commodity Futures Trading Commission is working to bring decentralized exchange Hyperliquid onshore under a compliant framework, causing the HYPE token to surge over 20%.
Spot Bitcoin ETF inflows
- ▪US spot Bitcoin exchange-traded funds recorded net weekly inflows of approximately $650 million to $700 million during the week of the rally.
- ▪Despite the weekly inflows, US spot Bitcoin exchange-traded funds remained in net outflows of approximately $4.76 billion year-to-date in 2026.
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