Bitcoin surged above $71,000 on Wednesday, marking its highest level in two months and triggering extensive short liquidations across the cryptocurrency market. The jump came after the U.S. Treasury announced an expansion of its buyback operations, intensifying bullish sentiment throughout major digital assets.
Major liquidations hit crypto shorts
Analytics firm CoinGlass reported $2.89 billion in short liquidations across the broader crypto market within the past 24 hours. Bitcoin traders accounted for $1.57 billion of these liquidations, while ether traders saw liquidations totaling $1.14 billion. Solana, another leading token, faced $108 million in short liquidations during the same period.
The widespread liquidation reflects a swift shift in market sentiment, forcing traders with bearish positions to exit at losses as asset prices rapidly climbed.
| Asset | Short Liquidations (last 24h) |
|---|---|
| Bitcoin | $1.57 billion |
| Ether | $1.14 billion |
| Solana | $108 million |
Major altcoins also benefited from the market momentum. Ether climbed nearly 20% to reclaim the $2,000 level for the first time since May. Solana, XRP, and other large-cap cryptocurrencies all registered gains exceeding 5% in the latest rally.
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AAPLU.S. Treasury triggers rally with buyback expansion
The market’s sharp turnaround followed a significant announcement from the U.S. Treasury. On Wednesday morning, the Treasury stated it would at least double the scale of its liquidity support buyback operations across the 10-to-20-year and 20-to-30-year maturity sectors.
The buyback cap per operation will rise from $2 billion to $4 billion, with the increased operations scheduled from September 9 through November 4. Analysts noted that easier financial conditions on the long end of the yield curve typically spill over into risk assets, including cryptocurrencies.
Mini dictionary: U.S. Treasury buyback operation, a process where the U.S. Treasury repurchases its own outstanding securities to enhance market liquidity, often influencing financial market conditions.
Bitcoin still trails record highs
Despite the rebound, Bitcoin remains well below its all-time high of over $126,000 set in October 2025. The current price reflects a decline of about 50% from that peak.
Unchained, a digital asset financial services provider, reported in June that this is the most moderate bear market in Bitcoin’s history, with the asset’s recent drawdown being less severe compared to previous cycles.
Unchained reported that Bitcoin’s approximate 50% slide from its record is the shallowest bear market the asset has experienced, compared to much more substantial declines during previous downturns.
Federal Reserve signals possible rate hikes ahead
Minutes released from the Federal Reserve’s July meeting displayed a split among policymakers. Several members suggested that higher interest rates would likely be necessary if inflation persists. Three regional bank presidents dissented in favor of an immediate quarter-percentage-point rate increase at that time.
These signals add some uncertainty for risk asset investors, as further monetary tightening could temper enthusiasm across equity and crypto markets moving forward.
