Bitcoin surged nearly 6% on Wednesday, reaching over $69,000 for the first time since early June, according to fortune.com. The rally followed the U.S. Treasury Department's announcement to double purchases of older long-term government bonds, which investors interpreted as a form of quantitative easing that weakens the dollar and boosts assets like Bitcoin.
Matt Mena, senior strategist at crypto research firm 21Shares, told fortune.com that the Treasury's move was seen as a quiet form of easing, prompting investors to buy Bitcoin aggressively. This buying pressure forced short sellers to cover approximately $1.5 billion in positions, including about $700 million purchased within a single minute, potentially marking the largest short squeeze in Bitcoin's history.
The rally comes after months of subdued price action following a severe crash last October that caused over $19 billion in liquidations. Since then, Bitcoin has dropped roughly 40% from its $115,000 peak. The recent Treasury announcement, combined with investors pricing in a pause in U.S. interest rate hikes and inflows of around $1 billion into U.S. spot Bitcoin ETFs in early August, has added new demand for the cryptocurrency.
Bitcoin's price surge to $69,000 marks a significant recovery milestone since the October crash, with the cryptocurrency's market dynamics influenced by both macroeconomic policy and investor behavior, as detailed by fortune.com.