Bitcoin surges over 25% on short squeeze and crypto optimism

Published on 21/08/2026 - 12:42 GMT+2

The world's largest cryptocurrency touched an intraday high of $79,500 on Friday, its best level in months, before easing to around $77,700 at the time of writing, leaving it up more than 25% since Monday.

The rally caps one of Bitcoin's most dramatic weeks in years, following a stretch in which the token had lagged well behind its 2025 highs for much of 2026.

For six straight weeks, Bitcoin had been stuck grinding between $62,000 and $66,000, having fallen over 50% from the all-time high of around $126,000 it reached last year in October, to the low of roughly $57,600 it hit early in July of this year.

That prolonged malaise had encouraged traders to build up bearish positions over the course of the year, betting the token's underperformance would continue. When the price broke higher this week, those bets unwound violently leading to an episode of forced short covering.

Ether, the second-largest cryptocurrency, and other digital assets have also surged on the same wave of positioning and momentum was reinforced by signals of extra liquidity from Washington.

The US Treasury doubled the size of its bond buybacks earlier in the week to calm a jittery bond market, and when yields climbed back regardless, US Treasury Secretary Scott Bessent vowed on Thursday to increase the buybacks even further.