Bitcoin has climbed toward $73,000 after a record short squeeze and falling U.S. Treasury yields powered an 11% rally, but analysts have warned that continued ETF and spot demand will decide whether the breakout holds.

Bitcoin’s short squeeze has accelerated the breakout

Nansen Senior Research Analyst Nicolai Søndergaard told crypto.news that forced short covering accelerated Bitcoin’s rise, although institutional demand and improved liquidity conditions had already given the market an upward bias.

“Bitcoin’s move above $70,000 reflects a combination of forced short covering, renewed institutional demand and a more supportive liquidity backdrop,” Søndergaard said.

Bitcoin traded near $72,600 after reaching about $72,800 on Aug. 20, extending a rally that began when the price cleared resistance around $65,000 and $67,000. The asset had spent roughly six weeks inside a narrow range before the breakout caught bearish traders positioned for another decline.

CoinGlass data showed that more than $1 billion in Bitcoin shorts were liquidated within about one hour. Across the crypto market, short liquidations reached approximately $2.7 billion over 24 hours, the largest total in records dating to 2021. Shorts accounted for about 92% of almost $3 billion in total liquidations across more than 172,000 traders.

As reported earlier on Thursday, Bitcoin gained 11.4% in 24 hours as the liquidations forced traders to buy the asset needed to close their positions. Forced purchases then pushed the price through additional liquidation levels, adding speed to the rally.

Søndergaard said that relatively contained open interest showed that the price increase did not come only from traders adding fresh leverage. Liquidation data also showed far more pressure on shorts than longs, supporting his view that forced covering drove the speed rather than the full direction of the move.

ETF demand may determine whether $70,000 holds

U.S. spot Bitcoin ETFs recorded about $517 million in net inflows on Aug. 19, according to SoSoValue data cited by the analysts. The daily total was the strongest since May and offered early evidence that institutional buyers were participating alongside traders closing short positions.

LVRG Research Director Nick Ruck said the Treasury announcement helped improve institutional sentiment after months of net ETF outflows. Allocators may now view Bitcoin’s recent trading range as a more favorable entry point, he added, rather than a reason to remain on the sidelines.

Ruck cautioned that a single inflow session would not establish a lasting institutional trend. A clearer course for U.S. interest rates, progress on the CLARITY Act, or expanded access through retirement accounts could provide stronger confirmation, according to the analyst.

“Sustained inflows are unlikely without additional confirmation,” Ruck said. “Until those catalysts develop, inflows will likely remain temporary rather than structural.”

Once forced buying fades, Søndergaard expects spot and ETF flows to determine whether Bitcoin can build support above $70,000. The price has moved above its 20-week and 200-day moving averages as well as the estimated short-term holder cost basis near $68,700, placing many recent buyers back in profit.

Momentum readings have become stretched, however. Søndergaard placed the one-hour relative strength index near 78 and the four-hour RSI above 85, while positive funding rates showed that leveraged positioning had become crowded on the long side.

A sustained hold above $70,000 would support the breakout, according to Søndergaard. A retreat into the $69,700 to $69,000 zone could serve as a normal retest rather than confirm a full trend reversal, although losing the area would expose the market to more selling.

CoinEx Chief Analyst Jeff Ko identified the 200-day moving average near $69,000 as the central technical level. Turning the former resistance area into support would strengthen the setup, he said, especially after approximately $650 million in net ETF inflows during the week.

Lower Treasury yields have eased pressure on Bitcoin

The rally began as the U.S. Treasury announced that it would at least double its long-end liquidity-support buybacks. Beginning Sept. 9, the maximum purchase size for nominal coupon securities in the 10-to-20-year and 20-to-30-year sectors will rise from $2 billion to at least $4 billion per operation.

Following the announcement, the 30-year Treasury yield fell from 5.34%, its highest level in 19 years, to about 5.19%. Falling yields reduce the return offered by low-risk government debt and can make assets such as Bitcoin more attractive to investors willing to accept additional volatility.

Nick Ruck said lower yields also ease financial conditions and reduce borrowing costs for companies and investors. Continued buybacks could support risk assets for several months if long-term rates remain contained, he added, while renewed inflation or fiscal concerns could reverse the relief.

Ko described the program as a liquidity-management tool rather than quantitative easing because the Treasury is changing the composition of its liabilities instead of creating central-bank money. Given the program’s limited size compared with the Treasury market, he interpreted the announcement mainly as a policy signal that officials are prepared to support liquidity at the long end.

BTSE Chief Operating Officer Jeff Mei also called the buybacks a short-term response to a lasting fiscal problem. The purchases may cool yields, but they do not reduce the federal deficit or remove inflation pressure, he said.

“When yields drop and the dollar weakens, risk assets tend to rally, and we’ve already seen Bitcoin move higher on the news,” Mei said.

For borrowing costs to remain lower, Mei said markets would need evidence of a slowing U.S. economy or a resolution to the U.S.-Iran conflict. Without progress on either issue, persistent inflation and government borrowing could push yields back up.

U.S. policy has added a political premium

Bitget Wallet Research Analyst Lacie Zhang said Bitcoin has started trading with a U.S. political premium as the White House presses for crypto legislation before the November midterm elections.

During an Aug. 19 event with executives from Coinbase, Gemini, Ripple, Chainlink Labs, and other companies, President Donald Trump urged Congress to approve what he called a “fair version” of the Digital Asset Market Clarity Act. The bill would establish federal market rules and divide oversight between the SEC and CFTC.

Previous White House event coverage detailed the approaching Senate test, which requires 60 votes to advance the legislation. Lawmakers are expected to return in September, leaving limited working time before campaigning for the midterms takes priority.

Zhang said the administration has an incentive to show lower borrowing costs, strong financial markets, and progress in high-growth industries before voters go to the polls. Democrats gaining Senate seats could expose the administration’s crypto policies to added scrutiny, which gives the White House and industry groups a reason to seek legislation before the election, she added.

The SEC supplied another policy catalyst on Aug. 18 by proposing Regulation Crypto Assets, a framework for certain investment contracts involving digital assets. The proposal includes an exemption for offerings of up to $5 million over four years and another for qualifying offerings of up to $75 million in a 12-month period.

Under the proposed SEC framework, a conditional safe harbor would also address when an investment-contract relationship tied to a crypto asset can end. Stakeholders will have 60 days to submit comments, and the proposal does not change current registration requirements unless the SEC adopts final rules.

Zhang warned that connecting Bitcoin sentiment to the election calendar creates political risk. Failure to move the CLARITY Act, controversy involving political conflicts of interest, or a loss of regulatory momentum after the midterms could weaken investor confidence, she said.

President Xi Jinping’s expected U.S. visit in September could add another political element, according to Zhang, because Trump has grouped crypto, artificial intelligence and financial technology within his push for American technology leadership. She described the visit as a policy context rather than a direct cause of Bitcoin’s daily move.

Ruck said ETF inflows would need support from contained Treasury yields and further regulatory progress to continue. Without those conditions, institutional purchases may appear in isolated sessions instead of developing into a sustained source of Bitcoin demand.

US CFTC Chair Michael Selig has told lawmakers and the crypto industry that the agency will continue moving on digital-asset regulation even if Congress does not pass the Digital Asset Market Clarity (CLARITY) Act. Speaking in prepared remarks at the CFTC’s Innovation Advisory Committee’s inaugural meeting on Thursday, Selig framed the agency’s approach as a way to “give CLARITY its breathing room” while still preparing rulemaking that could be deployed quickly if the bill stalls.

Selig also described actions already set in motion inside the commission, including work aimed at allowing both registered and non-registered entities to offer leveraged or margined crypto asset trading, alongside efforts to develop protections for developers. His comments came as the broader crypto policy debate in Washington remains tied to the timing of Senate proceedings and ongoing negotiations over the bill’s content.

Key takeaways

• Despite CLARITY being the central market-structure proposal, CFTC leadership signaled it will pursue crypto rules independently if Congress cannot finalize the legislation.
• Selig said staff have already been directed to consider rules that would enable leveraged or margined crypto trading by both registered and non-registered entities.
• The CLARITY bill appears paused until the US Senate returns in September, with a cloture vote requiring 60 support to advance.
• Selig’s agenda aligns with the SEC’s parallel approach: proposed digital-asset rules designed to provide clearer regulatory pathways for market participants.
• The CFTC is currently operating with a limited leadership panel, with Selig described as the only Senate-confirmed commissioner directing agenda-setting since December.

CFTC: rulemaking won’t wait for CLARITY

In his remarks, Selig argued that the CFTC should not stand still while Congress deliberates. He said the commission would move forward on crypto regulations even without CLARITY’s passage, suggesting the agency could help ensure implementation of the administration’s priorities if the bill is delayed or revised.

“We’re going to give CLARITY its breathing room for a vote,” Selig said, but added that if Democrats cannot support a bipartisan product that reflects compromises from both sides of the aisle and reaches the President, he would direct CFTC staff to “move swiftly” to propose new rules for the industry.

In practical terms, Selig said he has already instructed staff to advance policy work related to crypto trading structures, including allowing leveraged or margined trading on a broader basis. He also pointed to an effort to explore developer protections—an element that has been gaining attention in US crypto policymaking as regulators attempt to distinguish between consumer-facing activity and other categories of software and infrastructure.

Where CLARITY stands in Congress—and why it matters

Although Selig indicated the CFTC is prepared to act on its own, the legislative path for CLARITY remains the major determinant of a unified national market-structure framework. The market-structure bill is currently effectively paused until the Senate returns to session in September. At that point, Majority Leader John Thune is expected to seek a cloture vote.

Under the Senate’s rules as described in the reporting, CLARITY would need 60 votes to pass the chamber and then return to the House of Representatives for final legislative approval before reaching President Donald Trump for signature or veto. This 60-vote threshold is especially consequential because it signals that the bill’s fate depends not only on broad support, but on overcoming procedural resistance.

Any uncertainty around the number of votes needed has been heightened by political questions tied to ethics. The source notes that some Democrats have called for stronger ethics provisions related to the Trump family’s crypto investments, reported as totaling $1.4 billion in 2025. Trump has claimed that a “lot of Democrats” support CLARITY, but it remains unclear whether that support is sufficient to reach the Senate threshold.

For market participants, the distinction is important: if CLARITY passes, it could standardize how US regulators approach key aspects of crypto trading and market structure. If it does not, the CFTC’s willingness to proceed suggests the industry could face a more fragmented regulatory landscape driven by agency rulemaking rather than legislation.

Coordination signal with the SEC’s proposed rules

Selig’s comments also echoed the direction taken by the Securities and Exchange Commission. According to the source, the SEC on Tuesday released proposed rules for digital asset regulation that would offer crypto companies a safe harbor policy from tokens being treated as “investment contracts,” along with certain exemptions for issuers.

While the SEC and CFTC operate in different jurisdictional domains, the alignment in messaging suggests regulators are attempting to reduce uncertainty in overlapping areas of the market—especially for trading, token offerings, and associated activities. For investors and operators, that could mean a clearer set of expectations on how rules might apply, even if Congress is still debating a comprehensive framework.

At the same time, regulatory coordination remains imperfect. The SEC proposal is designed around its own statutory interpretation and enforcement priorities, while the CFTC focuses on commodities and derivatives-related market activity. That difference is why agency-by-agency rulemaking may not fully substitute for legislative clarity.

Innovation committee focus: AI, prediction markets, and CFTC jurisdiction

Selig delivered his remarks alongside Innovation Advisory Committee Chair Walt Lukken and the committee’s Designated Federal Officer Michael Passalacqua. Beyond the CLARITY debate, the meeting agenda reportedly included artificial intelligence and prediction markets.

The CFTC has claimed “exclusive jurisdiction” over prediction markets, according to the source, based on its view that event contracts on relevant platforms are “swaps.” Selig has said he directed the commission to pursue lawsuits against state-level authorities that challenge this position—referenced in the source in connection with matters involving companies such as Kalshi and Polymarket.

For builders and traders in prediction markets, these jurisdictional disputes are not abstract. They can influence where platforms operate, how products are structured, and what legal risk markets face when expanding into new states or audiences. In that context, CFTC momentum on broader digital-asset rulemaking may also affect how prediction-market platforms plan future product design and compliance programs.

CFTC leadership constraints add urgency

The meeting also highlighted an internal constraint: the CFTC, as described in the source, currently lacks a full panel of commissioners. Selig has been operating as the only Senate-confirmed commissioner within a leadership group expected to consist of a bipartisan five-member panel.

Because of that imbalance, Selig has been solely responsible for directing the agency’s agenda since December, which may help explain the emphasis in his remarks on speed—both in continuing existing initiatives and in preparing contingencies should Congress not reach a legislative conclusion.

In the near term, investors and industry participants should watch whether the CFTC’s ongoing rulemaking work translates into formal proposals, and whether CLARITY can clear the Senate’s procedural and political hurdles in September. The immediate uncertainty is legislative, but the immediate regulatory direction is already becoming clearer from agency-level activity.

Michael Selig, who chairs the US Commodity Futures Trading Commission (CFTC), signaled that the agency would not be idle while Congress continued to debate provisions in a cryptocurrency market structure bill.

In prepared remarks for the inaugural meeting of the CFTC’s Innovation Advisory Committee on Thursday, Selig said that the commission would move forward on crypto regulations even in the absence of the Digital Asset Market Clarity (CLARITY) Act being passed by lawmakers, adding it would “help [Donald Trump] deliver if Congress will not.” According to the chair, he had already directed staff to allow registered and non-registered entities to offer “crypto asset trading on a leveraged or margined basis” and explore developer protections.

“We’re going to give CLARITY its breathing room for a vote, but if the Democrats cannot support a bipartisan work product, which reflects compromises from both sides of the aisle, and ultimately send a fair version of the bill to the President’s desk, then rest assured, I will direct CFTC staff to move swiftly to propose these new rules for the industry,” said Selig.

The market structure bill is effectively paused until the US Senate returns to session in September, when Majority Leader John Thune is expected to hold a cloture vote on the legislation. CLARITY would need 60 votes to pass the chamber and return to the House of Representatives, whereupon it could go to Trump’s desk for final approval or a veto.

Related: Trump claims he can ‘future proof’ crypto regulation with CLARITY Act

Selig’s remarks came just a day after the CFTC chair stood alongside Trump and other crypto industry leaders at a White House meeting. The president urged Congress to pass a “fair version” of CLARITY to keep the country “ahead of China.”

Many Democrats in Congress have been calling for stronger ethics provision in the market structure bill specifically to address the Trump family’s crypto investments, which netted the president $1.4 billion in 2025. Although Trump said on Wednesday that a “lot of Democrats” approved of CLARITY, it’s unclear whether enough lawmakers will support the bill to meet the 60-vote threshold to pass the Senate. 

The CFTC chair’s agenda echoed that of the US Securities and Exchange Commission (SEC), which on Tuesday released proposed rules for digital asset regulation. The securities regulator said the rules could provide crypto companies with a safe harbor policy from tokens being treated as “investment contracts” and certain exemptions for issuers.

CFTC still lacks a full panel of commissioners

Selig spoke alongside Innovation Advisory Committee Chair Walt Lukken and the body’s Designated Federal Officer Michael Passalacqua on Thursday. As the only Senate-confirmed commissioner at the CFTC in a leadership panel expected to consist of a bipartisan group of five members, Selig has been solely responsible for directing the agency’s agenda since December.

The CFTC committee also discussed issues related to artificial intelligence and prediction markets on Thursday. Under Selig, the agency has claimed that it has “exclusive jurisdiction” over prediction markets due to event contracts on the platforms being considered “swaps.” The chair has directed the commission to file lawsuits against state-level authorities challenging this position in cases involving companies like Kalshi and Polymarket.

Magazine: Here’s why the CLARITY Act’s ethics deal may be so hard to reach

Bitcoin miners are pouring large sums into AI and high-performance computing (HPC) ventures, but early financial results show that the shift is still far from economically catching up with the scale of the investment. According to BlocksBridge Consulting’s latest Miner Weekly update, miners and AI-adjacent data center operators have committed tens of billions to capital assets—much of it happening before meaningful revenue ramps up.

BlocksBridge reported that 15 publicly listed Bitcoin miners and AI data center companies collectively spent $30.7 billion on capital assets in their latest 2026 reporting periods. That figure is already 42.6% higher than the $21.53 billion they spent across all of 2025. For investors, the key question is whether current AI/HPC revenue growth can narrow the gap between upfront spending and cash returns fast enough to justify the pivot.

Key takeaways

• BlocksBridge Consulting says 15 public Bitcoin miners and AI data-center companies spent $30.7 billion on capital assets in their latest 2026 reporting periods—42.6% more than total 2025 capex.
• Nine comparable miners spent $5.11 billion on capital assets in the first half of 2026 while generating $341.2 million in directly reported AI and HPC revenue (about a 15-to-1 capex-to-revenue ratio).
• AI and HPC revenue from those nine miners rose to $205.8 million in the second quarter, up 52% quarter-on-quarter.
• BlocksBridge cautions that converting power and land advantages into AI-ready infrastructure requires expensive build-outs, including substations, buildings, cooling, networking—and sometimes GPUs.

Capex surges, revenue lags in the AI pivot

The strongest signal in BlocksBridge’s data is the imbalance between spending and monetization. While AI and data-center strategies are widely viewed as diversification pathways for miners facing cyclically tough mining economics, BlocksBridge’s numbers suggest the transition remains capital intensive.

BlocksBridge calculated capital spending by combining cash purchases with allocations to hardware, property, equipment and other productive assets—netting out proceeds and refunds from asset sales. The methodology matters because it points to a “build” phase rather than a purely expansionary one: companies are acquiring and deploying physical assets at speed, even as revenue capture is still ramping.

Drilling into Bitcoin miners specifically, BlocksBridge noted that nine comparable miners invested $5.11 billion in capital assets during the first half of 2026. Yet those firms generated only $341.2 million in directly reported AI and HPC revenue during the same window. The resulting ratio—roughly 15-to-1—illustrates how far the industry is from turning capital deployment into proportionate operating returns.

What is changing: faster AI/HPC revenue growth

Despite the gap, BlocksBridge reported signs of acceleration. In the second quarter, the same group of nine miners generated $205.8 million from AI and HPC businesses, representing a 52% quarter-on-quarter increase. BlocksBridge highlighted Core Scientific, TeraWulf and Bitdeer among the companies showing gains.

For readers watching diversification outcomes, the practical implication is that the pivot may be entering a more revenue-generating stage—at least for some participants. However, the magnitude of earlier spending underscores that even sharp quarter-to-quarter growth may still be insufficient to erase the balance-sheet effect of large capex programs in the near term.

What investors should watch next is whether accelerating revenue translates into improving margins and more consistent demand. BlocksBridge’s figures focus on “directly reported” AI and HPC revenue; the market will likely scrutinize whether additional segments scale without requiring equally steep follow-on investments.

Why the transition is expensive: power and land aren’t enough

BlocksBridge also framed why miners can’t simply repurpose existing infrastructure and expect AI profits quickly. In its analysis, the firm said that power contracts and available land may provide a starting advantage, but turning those inputs into AI-ready capacity involves additional, costly components.

According to BlocksBridge, the build-out can require substations, buildings, cooling systems, networking equipment, and in some business models, GPUs. This helps explain why capex-to-revenue ratios can remain elevated: building AI-capable data center and compute infrastructure is not just an incremental upgrade—it is a construction and integration project with multiple dependency layers.

At the same time, the source notes that it remains unclear whether any recovery in Bitcoin’s price will ease near-term pressure on miners that still operate sizable mining fleets. When cash flows from traditional mining are volatile, the timing of AI revenue maturation becomes even more important.

Broader market signals: miners still betting big as policy improves liquidity

While BlocksBridge’s report centers on AI/HPC economics, the surrounding market context matters because it influences how much funding and operational stress miners can absorb. The article points out that Bitcoin rose more than 13% over the week and returned above $72,000 following a US Treasury announcement that it would at least double the maximum size of its long-term bond buybacks to $4 billion per operation. The move was described as intended to improve liquidity in the Treasury market and was associated with lower yields and a boost to risk appetite.

Even with that supportive backdrop, the central takeaway from BlocksBridge remains: AI diversification is expensive upfront. For investors, this creates a tension—markets may improve financing conditions while the underlying monetization timeline lags behind construction.

Separately, the pivot to AI-linked compute and power has also appeared in investment products. CoinShares announced a strategic change to its industry tracking exchange-traded fund, rebranding it as the CoinShares Bitcoin Mining and Digital Power ETF (WGMI). CoinShares says the fund holds 29 companies spanning bitcoin miners, data center operators, AI semiconductors, power generation and HPC. As of the announcement, the ETF reported $222.4 million in assets under management, and CoinShares described the theme as “the businesses powering the digital economy,” according to its listing page.

For market participants, the launch and rebranding of a targeted ETF can be interpreted as demand from investors for exposure beyond pure mining. Still, such products ultimately depend on underlying company execution—especially whether AI/HPC revenue continues to grow fast enough to justify large capital programs.

Going forward, the most important uncertainty is whether rising AI and HPC revenues can outpace the continuing cost of expansion and integration. BlocksBridge’s quarter-on-quarter growth is encouraging, but investors should monitor whether that momentum persists, improves profitability, and reduces the still-wide spending-to-return gap highlighted in its capex-to-revenue calculations.