Treasury Buyback Boosts Bitcoin to $69,970 Amid Short Squeeze
Bitcoin surged more than 8% intraday on August 19, reaching $69,970 and nearing the psychologically important $70,000 level. The US Treasury Department announced it would at least double the per-operation cap on liquidity support buybacks for 10- to 30-year nominal Treasuries from $2 billion to $4 billion, prompting long-end yields to retreat and the dollar to weaken.
The massive wave of passive buying from short covering further propelled the cryptocurrency higher, creating a classic short squeeze. Over $1 billion in bitcoin short positions were forcibly liquidated within roughly one hour, marking the largest short-squeeze on record since data collection began in 2021.
Crypto-linked equities rallied broadly, with Coinbase up over 9% and Strategy up over 12%. The Federal Reserve's July minutes showed some members leaning hawkish, with markets pricing a 67.7% probability of rates staying unchanged in September.