News Maker 23

The crypto asset market saw renewed enthusiasm during the European trading session on Friday (August 21) as Bitcoin extended its strong rally, putting it on track for its largest weekly gain in over two years. Bitcoin (BTC) traded around US$77,000, up more than 6% for the day and posting a gain of approximately 20% for the week.

Bitcoin's surge was driven by a combination of positive sentiment across global financial markets following the US Treasury Department's announcement of an expanded long-term Treasury bond buyback program. This move exerted downward pressure on bond yields and weakened the US dollar, prompting investors to return to risk assets, including digital assets.

Crypto momentum strengthened further after President Donald Trump met with several industry leaders and reiterated his push for the passage of the Clarity Act—a proposed bill aimed at establishing a clearer regulatory framework for the US digital asset market. The meeting raised expectations that the US administration would adopt an approach more supportive of the crypto industry's growth.

Beyond regulatory sentiment, the Bitcoin rally was also fueled by a short squeeze. Data from Coinglass indicates that over US$2 billion in bearish Bitcoin positions in the perpetual futures market have been liquidated since August 19, forcing traders who had bet on price declines to buy back their positions.

Institutional capital inflows have also picked up again. US spot Bitcoin ETFs recorded their largest weekly inflows since January, with the 13 ETFs attracting over US$1 billion in capital throughout the week. Activity among large investors was also evident, as CryptoQuant data showed Bitcoin "whales" increasing their holdings by approximately US$2.75 billion over the past 60 days.

Elsewhere in the crypto market, Ethereum (ETH) traded around US$3,100, up approximately 8%, while Solana (SOL) rose about 9% to the US$210 level. XRP rose approximately 7% to US$3.20, BNB climbed about 5% to US$780, Cardano (ADA) gained around 6% to reach US$1.05, and Dogecoin (DOGE) strengthened by about 5% to US$0.32. The gains across nearly all major assets signal a resurgence in investor risk appetite following a prolonged period of pressure in the crypto market.

Newsmaker Analysis: Current crypto momentum is driven by a combination of a weakening US dollar, expectations of looser liquidity resulting from Treasury actions, and optimism regarding the regulatory outlook for digital assets under the Trump administration. Bitcoin has the potential to sustain its positive trend as long as ETF inflows and accumulation by large investors continue. However, the roughly 20% weekly gain means the risk of profit-taking warrants caution should the market begin to lock in profits. (arl)

Source: Newsmaker.id