Bitcoin and Ethereum have broken sharply higher after weeks of compressed trading, with BTC briefly touching $70,000 and Ether gaining almost 18% as fresh liquidity, institutional inflows and forced short covering converged on the market at the same time.

Bitcoin traded near $69,400 in the latest market check, up more than 7% over 24 hours, while Ethereum changed hands around $2,250, up roughly 18%. The move marks a major shift from last week, when Bitcoin was stuck near $63,900 as spot trading volume fell to its lowest level since 2019.

Altcoins followed the move rather than being left behind. Solana posted double-digit gains during the surge, BNB climbed about 4%, and the broader altcoin market added roughly 7% as capital spread beyond BTC.

Treasury Buybacks Change the Liquidity Setup

The largest macro catalyst arrived from the U.S. Treasury. The department doubled the maximum size of long-term Treasury buybacks from $2 billion to at least $4 billion per operation for securities in the 10-to-30-year maturity range, beginning September 9, according to the Treasury announcement. Buybacks, which the Treasury relaunched in 2024 for the first time since 2002, let the department repurchase outstanding securities from primary dealers, a tool intended to support trading liquidity in the government bond market.

Long-term yields fell immediately after the announcement, while the dollar weakened. The 30-year Treasury yield dropped toward 5.20% and the 10-year moved toward 4.65%, per FRED data, reversing part of the bond-market shock that had been pressuring risk assets. For crypto, an asset class with no cash flows that trades largely on liquidity expectations, that swing in conditions was a direct input rather than background noise.

Crypto reacted aggressively because the market had been positioned for continued liquidity stress. More than $1.2 billion of bearish crypto positions were liquidated in roughly one hour as Bitcoin accelerated through resistance, forcing short sellers to buy back positions into an already rising market.

ETF Demand and Washington Add Fuel

Institutional demand had already started improving before the breakout. U.S. spot Bitcoin ETFs, launched in January 2024, have become one of the main channels for institutional exposure to the asset, which is why the daily flow prints draw outsized market attention. Farside's spot Bitcoin ETF flow tracker recorded $297.5 million of net inflows on August 17 and another $189.3 million on August 18, reversing the heavy redemption pressure that dominated earlier summer trading.

Ether funds followed with $30.9 million and $71.4 million over the same two sessions. Ethereum also entered the rally with stronger on-chain participation, after daily new ETH addresses jumped 75% from August 8 to August 16.

Washington supplied another layer of buying sentiment. The SEC has now proposed dedicated crypto fundraising rules with exemptions reaching $75 million annually, while President Donald Trump used an August 19 White House meeting with crypto executives to press Congress for broader market-structure legislation.

That regulatory boost has arrived even as prediction-market odds for the CLARITY Act — the House-passed market-structure bill that would divide crypto oversight between the SEC and the CFTC — collapsed to just 20%, leaving agency rulemaking as the more immediate policy catalyst.

Ethereum Leads as Altcoin Breadth Expands

Ethereum's outperformance is the strongest sign that the rally has moved beyond a Bitcoin-only squeeze. ETH pushed from below $2,000 through $2,100 and above $2,250 in a single session, while Bitcoin dominance — Bitcoin's share of total crypto market capitalization — remains near 56%.

The wider crypto market capitalization gained roughly 7% over 24 hours, with altcoin capitalization expanding at a similar pace. That breadth separates the move from several earlier 2026 Bitcoin rebounds, in which smaller assets failed to participate.

Altcoins are participating more broadly in the rebound, but Bitcoin still controls much of the market's liquidity and momentum. Wednesday's acceleration was amplified by a heavy short squeeze, so continued gains across ETH, SOL and other large-cap tokens will depend increasingly on fresh spot buying rather than forced liquidations.

Bitcoin was trading near $69,400 early Thursday after briefly reaching $70,000, while Ethereum held near $2,250 after its strongest daily advance in months.