Bitcoin traded as high as $75,740 in Asian hours on Friday, Bloomberg reported, extending a three-day run that has added close to 20% to the price. It is the first time the largest cryptocurrency has traded above $75,000 since May.

The move is large, and it is worth being precise about where it came from. Most of the immediate buying was not a fresh vote of confidence in bitcoin. It was traders who had bet on a falling price being forced to buy their way out.

What a short squeeze actually is

A short seller borrows an asset, sells it, and hopes to buy it back cheaper. If the price rises instead, the loss grows with every dollar of the move, and an exchange will eventually close the position automatically by buying the asset back at the market price. That forced purchase pushes the price up further, which triggers the next set of closures.

That is what happened on Wednesday. Roughly $2.75 billion of bitcoin short positions were liquidated in a single day, and across crypto derivatives more broadly about $3 billion of leveraged bets were wiped out, hitting more than 174,000 traders. Bitcoin broke out of a six-week trading range in the process and crossed above its 200-day moving average for the first time since November, a line long-term traders watch as a rough marker of trend.

The trigger came from the bond market, not from crypto

The catalyst was Treasury Secretary Scott Bessent's announcement that the department would double the size of its long-dated bond buybacks, from $2 billion to at least $4 billion per operation, starting on September 9. Buying back existing long bonds supports their prices, which pushes yields down and, in this case, weakened the dollar. Assets that pay no income, bitcoin among them, tend to look better when yields fall and the dollar softens.

Two policy events landed on top of that. President Trump met crypto executives at the White House to press the Senate on the Digital Asset Market Clarity Act, the bill that would split oversight of digital assets between the securities and commodities regulators. Separately, the head of the Commodity Futures Trading Commission told staff to prepare crypto rules of their own if the Clarity Act fails in Congress, which removes some of the downside from a legislative failure.

Money is also arriving through the ETFs

Not all of the demand is forced. Spot bitcoin exchange-traded funds took in more than $1 billion over three days, with BlackRock's iShares Bitcoin Trust accounting for $588.5 million of it. One session alone produced $517 million of net inflows, the largest daily figure since early May. Those flows matter because ETF buying is spot buying: the fund has to acquire and hold the coin, unlike a derivatives position that can be closed with a keystroke.

The case for scepticism

Analysts quoted this week were notably unwilling to call this a new bull market. Shawn Young, chief analyst at MEXC Research, said crypto is "giving the Treasury's intervention far more credit than it deserves" and described the push above $70,000 as premature, arguing the announcement forced shorts out faster than it improved the macro case for the asset. Dominick John of Zeus Research framed the open question plainly in the same report: whether fresh capital arrives to turn a squeeze into a sustained move.

There is a further piece of context that the week's numbers obscure. Even at $75,000, bitcoin remains roughly 40% below the record of $126,080 it set in October. The Fear and Greed gauge has climbed to 62, its highest reading since October 2025, which tells you sentiment has turned but not that valuations have.

The near-term test is legislative. The Senate left for its August recess without voting on the Clarity Act, and a procedural vote is expected in September. A market that has priced in passage has more to lose from delay than it has to gain from confirmation.