Bitcoin continued to rally in Asian trading on Friday, putting the cryptocurrency on track for its largest weekly gain in more than two years. The digital asset climbed as much as 4.2 percent to $75,740 and traded around $74,500 at noon in Singapore. Having advanced nearly 20 percent over the week, the current trajectory marks its biggest weekly increase since March 2024.
Despite the recent surge, Bitcoin remains notably below its peak of over $126,000 reached last October, which preceded a sharp selloff that brought prices down to $58,642 at the end of June.
Market exuberance returned following an announcement on Wednesday by US Treasury Secretary Scott Bessent regarding the department's plans to at least double the size of its long-dated bond buybacks. This policy action triggered an upswing that forced traders to liquidate billions in short positions. On the same day, President Donald Trump held a meeting with crypto industry leaders to discuss regulatory matters.
Rachael Lucas, an analyst at BTC Markets, noted that the Treasury's bond buybacks served as the primary catalyst. "The real driver was the US Treasury doubling long-dated bond buybacks, which pulled long yields lower and lifted risk appetite broadly," Lucas said. She added, "Nothing has rewritten Bitcoin’s long-term case, but nothing’s rewritten its volatility either."
A significant factor sustaining the rally has been a short squeeze in the derivatives market. According to data from Coinglass cited by Adam Morgan McCarthy, lead researcher at LO:TECH, more than $2 billion in bearish Bitcoin bets in the perpetual futures market have been liquidated since August 19.
However, analysts point out divergent signals within broader macro markets. McCarthy highlighted gold's performance as a clearer indicator of defensive positioning. "Gold carries this week’s real macro signal: it rallied cleanly on the Treasury doubling its bond-buying operations, with none of the forced buying that inflated Bitcoin’s price," McCarthy said. "If you’re looking for where investors are actually hedging against currency and inflation risk this week, gold shows it, and Bitcoin doesn’t."
Political developments also contributed to market sentiment. President Trump’s meeting with executives from firms including Coinbase Global Inc and Payward Inc was viewed as a positive signal regarding the administration's stance on digital assets. During the discussions, Trump urged the Senate to pass the Clarity Act, a crypto market structure bill that had stalled before the August recess due to disagreements over ethics provisions.
Institutional interest rebounded concurrently. US-listed spot Bitcoin exchange-traded funds (ETFs) are on track for their largest weekly inflows since January. The 13 ETFs added more than $1 billion between Monday and Wednesday. Additionally, on-chain data from CryptoQuant indicates that large holders, commonly referred to as whales, accumulated approximately $2.75 billion worth of the token over a 60-day period.
Reflecting on the multiple catalysts, Lucas stated, “Trump’s crypto meeting, Clarity Act momentum, and positive ETF inflows added sentiment on top, but they weren’t the whole story.”
"The recent surge in Bitcoin highlights how macroeconomic policy decisions and regulatory engagement can rapidly shift market sentiment. While short-term liquidity events like bond buybacks and forced liquidations create significant price momentum, businesses and investors must remain cautious of underlying market volatility. Sustainable growth in the digital asset ecosystem will ultimately rely on clear regulatory frameworks, such as the proposed Clarity Act, alongside steady institutional participation rather than purely speculative trading." — Dr. Shishir Gupta, Founder & CEO, StartupLanes
