Bitcoin Surpasses $72,000 as ETF Inflows Boost Rally

Bitcoin surged above $72,000 on Thursday, reaching its highest price since June after a rally that wiped out billions of dollars in bearish bets. The sharp move, which saw the cryptocurrency gain nearly 15% since Monday, was driven by a combination of a massive short squeeze, improved liquidity expectations from U.S. Treasury actions, and fresh regulatory proposals. Analysts, however, cautioned that the rally's sustainability will depend on whether fresh spot buying can replace the forced covering that fueled the initial surge.

The price spike triggered the largest liquidation of short positions on Bitcoin since at least 2021, with more than $3 billion in crypto short positions liquidated. Data showed that over $1 billion in Bitcoin shorts were liquidated within a single hour as the price broke above $70,000, forcing traders to buy the asset to close their positions. This cascade of forced purchases accelerated the rally, pushing Bitcoin to a two-month high near $73,000.

The technical picture improved significantly as Bitcoin reclaimed its 200-day simple moving average around $69,000, a key level watched by traders. Momentum indicators also turned bullish, though some analysts...