Bitcoin price extends gains, briefly tops $80,000 overnight, as crypto rally gathers pace
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- Bitcoin gained about 2.5% in early trading to briefly touch the $81,000 mark before paring back to $79,358.16 (up 0.7%), extending a rally that saw the cryptocurrency surge more than 20% in three days — its biggest three-day gain since 2023.
- The short squeeze liquidated more than $4 billion in bearish crypto positions, and Fundstrat said the subsequent buying pattern suggests the rally may be 'more durable than a tactical bounce,' pointing to ETF inflows, increased trading, and stablecoin creation.
- U.S. spot bitcoin ETFs attracted $1.92 billion in net inflows last week — their largest weekly haul since October, when bitcoin hit its previous cycle peak — providing a fresh institutional demand catalyst.
- The U.S. Treasury's announcement that it would double purchases of longer-dated government bonds briefly pushed yields lower, reviving demand for risk assets while inflation and government debt concerns boosted appetite for assets perceived as scarce.
- Options market activity signals growing confidence in the rally's durability, with traders paying for exposure to bitcoin gains further into the future rather than focusing on short-term moves as in earlier rebounds.
- Strategy, the world's largest corporate bitcoin holder, has not purchased bitcoin for two weeks — and Fundstrat noted a resumption of corporate buying layered onto strong ETF demand could add another leg of support.
- XRP rose 0.5% to $1.4843, up 48% over the past seven days, while ether gained 0.5% to $2,481.91.
Why it matters: The combination of $1.92 billion in weekly ETF inflows and $4 billion in short liquidations signals institutional demand is becoming structural rather than tactical. For traders, the next inflection point is whether Strategy resumes buying after a two-week pause — a fresh corporate bid layered on top of ETF flows could extend the rally, while a failure to break resistance may trigger the kind of fade BTIG flagged following January 2023's similar surge.
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