Bitcoin capped a powerful week on Friday, posting a 22% gain as a wave of positive catalysts, including a surprise Treasury intervention and a massive short squeeze, brought investors back into the largest cryptocurrency.
Bitcoin ended the trading day up 6% at $76,943.90, climbing from roughly $62,800 at the start of the week. The rally was accompanied by sharp gains in crypto-related equities, with Coinbase advancing 8% and Strategy rising 6%.
The move began Wednesday, when Treasury yields pulled back sharply following an unexpected intervention by the Treasury in the bond market. That shift eased pressure on risk assets and helped trigger a broader move into crypto. The upswing was later amplified by a heavy short squeeze, with approximately $2.7 billion in crypto short positions liquidated, according to CoinGlass data.
Max Stuedlein, head of partnerships at Sygnum APAC, said bitcoin’s advance reflects a convergence of macroeconomic and policy catalysts. “The Treasury’s decision to double its buybacks of long-dated government debt is aimed at addressing long-term yield concerns, where borrowing costs have been rising on concerns over US debt levels and partial crowding out by debt issuances of hyperscalers,” he explained.
Investor sentiment improved further on Thursday, largely due to a last-ditch push from the White House and crypto industry leaders to advance the Clarity Act in the coming weeks. The bill is widely viewed as a key catalyst that could help lift the market out of the crypto winter that began last fall, though the chances of its passage appear relatively slim.
Despite the recent rally, bitcoin remains well below its 2026 high of $94,820, reached in mid-January, and its all-time high of $126,198, set on October 6 last year.
Lucy Gazmararian, founder and managing partner at Token Bay Capital, told CNBC’s “Squawk Box Europe” on Friday that crypto is nearing the end of its bear market. “We’re expecting one final flush, and for it to drop another 20%, so that it’s in keeping with prior cycles,” she said. “The market was heavily leveraged short, and they’ve been wiped out. So I think it’s the market expectation – they’re very savvy to the cycles of bitcoin, and they position accordingly in those final months before the cycle turns from bull to bear and vice versa.”
She urged bitcoin investors to “hold the longer-term thesis,” calling bitcoin trades “a play against monetary debasement.” But she acknowledged the asset’s short-term volatility. “In the shorter term, it’s very much moving along these cycles because it’s still a very volatile asset,” she told CNBC. “So it’s a great playground for traders, and now we have so many tools to place bets either way on bitcoin now.”
As the week drew to a close, bitcoin’s sharp rebound underscored how quickly sentiment can shift in crypto markets. While the rally has revived optimism, the path ahead remains uncertain, with traders eyeing both potential legislative developments and the possibility of one more downturn before a sustained recovery takes hold.
