Bitcoin Surges Past $71,000 as Trump Backs Crypto Clarity Act, August 21

Bitcoin climbed above $71,000 on Wednesday for the first time in over two months, driven by falling US Treasury yields and renewed optimism around cryptocurrency regulation. The rally triggered record $2.7 billion in short liquidations across the crypto market within 24 hours, according to CoinGlass data. President Donald Trump’s White House meeting with crypto executives from Coinbase, Payward, and Blockchain.com revived hopes for the stalled Clarity Act, a proposed market-structure bill.

Treasury moves spark the rally

The US Treasury announced plans to increase buybacks of longer-term government debt, pushing the 30-year yield down from its recent peak near 5.7% to around 5.2%. The 10-year yield fell closer to 4.65%. Lower bond yields reduce the appeal of interest-bearing investments, making risk assets like Bitcoin more attractive to investors seeking returns. The dollar weakened to a three-month low as the news landed, making dollar-denominated crypto more appealing to overseas buyers.

Short squeeze wipes out $2.7 billion

Bitcoin’s 8% jump in 24 hours forced traders holding bearish bets to close positions at losses. More than $1 billion in Bitcoin shorts were liquidated in roughly one hour, according to CoinGlass. Across all crypto tokens, $2.7 billion in short positions were wiped out, with shorts accounting for 92% of total losses. This exceeded the $2.47 billion short liquidation during October 2025’s selloff. One trader on Hyperliquid lost nearly $24 million after a 50,000 ETH short position closed in 12 seconds.

Trump’s crypto meeting revives regulatory hopes

President Trump met with crypto industry leaders on Wednesday at the White House, signalling support for the Clarity Act, which stalled before the Senate’s August recess. The meeting boosted market sentiment that a Trump administration will pursue a more industry-friendly regulatory framework. The Securities and Exchange Commission also proposed this week to exempt certain digital-asset offerings from securities registration, advancing the crypto agenda after landmark legislation failed in Congress.

Crypto-linked stocks rally alongside Bitcoin

Circle Internet Group (CRCL) shares climbed 5% on Thursday as the Bitcoin surge lifted the broader crypto sector. MicroStrategy (MSTR) and Riot Platforms (RIOT) each gained around 4%, while Robinhood (HOOD) advanced 4%. Bitcoin’s market capitalization rose 11.1% in 24 hours to $1.43 trillion, with daily trading volume surging over 260% to $60.8 billion. Ethereum jumped 17.5% to $2,240.70, Solana rose over 10% to $84.70, and Ripple climbed 10% to $1.10.

Final Thoughts

Bitcoin’s break above $71,000 reflects a shift in market sentiment driven by lower yields and regulatory optimism. For Australian investors, the move signals renewed appetite for risk assets, though the sustainability of this rally depends on whether fresh buying momentum can replace the short-covering gains that fuelled Wednesday’s surge.

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The content shared by Meyka AI PTY LTD is solely for research and informational purposes.  Meyka is not a financial advisory service, and the information provided should not be considered investment or trading advice.