Bitcoin Surges Above $80,000 Amid Treasury Intervention and Short Squeeze

Bitcoin has broken through the $80,000 barrier for the first time since May 15, 2026, as a combination of factors propelled it on its strongest rally in years. The cryptocurrency surged above $80,000 following a Treasury bond buyback announcement and a historic short squeeze.

The U.S. Treasury Department's decision to double the maximum size of long-dated bond buyback operations from $2 billion to at least $4 billion was the primary catalyst for crypto's rebound. This move aimed to improve liquidity in the bond market, which had seen yields surge to levels not seen since 2007.

The Treasury's announcement sparked a powerful short squeeze in the crypto market, with more than $3 billion in short positions liquidated as Bitcoin broke higher. Forced buying amplified the rally, pushing Bitcoin from around $62,800 on August 19 to touch $80,000 late on Friday, August 23.

The broader context for the rally included renewed regulatory support for the cryptocurrency industry. Earlier in the week, Trump had met with crypto leaders and backed the CLARITY Act, pending crypto legislation in Congress.