Bitcoin recently reclaimed the $74,000 level for the first time in 86 days, supported by a significant increase in institutional activity and a sharp rise in U.S. spot Bitcoin ETF trading volumes.
During the rally, U.S. spot Bitcoin ETFs recorded more than $5.3 billion in trading volume. BlackRock’s IBIT led activity with $4.44 billion, followed by Fidelity’s FBTC at $438 million and Grayscale at $208.8 million. Bitwise, ARK Invest, VanEck, Morgan Stanley, Franklin Templeton, Invesco, Valkyrie, WisdomTree, and Hashdex accounted for the remaining volume.
The funds also attracted $517.19 million in net inflows, marking their strongest inflow day since May 4. Eight of the 12 funds recorded positive flows, led by BlackRock’s IBIT with $284.7 million, ARK and 21Shares’ ARKB with $77.7 million, and Fidelity’s FBTC with $62.4 million.
Market Impact and Liquidations
The ETF activity coincided with a roughly 17% surge in Bitcoin over two days, adding approximately $11,000 to its price and more than $220 billion to its market capitalization. The swift upward movement triggered a major short squeeze, resulting in the liquidation of more than $3.6 billion in short positions over a 72-hour period. This included $2.75 billion in Bitcoin shorts on Wednesday, followed by another $783.2 million in liquidations over the next 24 hours, of which $747.7 million came from short positions, according to CoinGlass data.
Catalysts and Cautious Outlook
The rally followed a U.S. Treasury Department decision to at least double liquidity-support buyback operations for longer-dated nominal coupon securities in the 10- to 30-year segment. Additional catalysts included an SEC crypto proposal and a White House meeting between President Donald Trump and crypto executives.
Despite the gains, Bloomberg analyst Mike McGlone expressed a bearish outlook, characterizing the price action as a bounce within a broader bear market. McGlone pointed to Bitcoin's volatility, its correlation with stocks, and excessive supply expansion in the wider crypto market, suggesting the potential for a rollover by year-end.
