Bitcoin Jumps 5% in Surprise Rally, Stirring $100,000 Year-End Calls

Has Bitcoin Bottomed? Three Catalysts Behind the Rebound

Up Nearly 5% in a Day

(1) U.S. Treasury Expands Long-Bond Buybacks

(2) Spot ETF Flows Turn Positive

(3) Hopes Rise for Easier Crypto Issuance Rules

Liquidity and Policy Tailwinds Warm Risk Assets

Caution Persists Over $100,000 Year-End Optimism

Bitcoin, which had been stuck around 90 million won, rebounded sharply. It climbed nearly 5% in a day for its biggest gain in five months. Ether surged 15% and quickly reclaimed the 3 million won level. The move came as U.S. Treasury measures to steady the bond market, inflows into spot exchange-traded funds and hopes for looser crypto regulation combined to lift sentiment.

Altcoins Join the Rally

According to Upbit, Bitcoin was trading at 95.347 million won as of 9 a.m. on Aug. 20, up 4.6% from 24 hours earlier. That was its biggest increase since March. Bitcoin briefly traded in the 96 million won range for the first time in two months, since July 23. In global markets, it briefly touched $70,000.

Altcoins, or cryptocurrencies other than Bitcoin, rose even more. Ether gained 15% to 3.097 million won at the same time. It was the first time in nearly three months, since May 25, that Ether traded above 3 million won. Major altcoins including XRP, up 8.03%, and Solana, up 8.4%, also climbed sharply.

The rally in major cryptocurrencies followed news that the U.S. Treasury Department would expand buybacks of long-term Treasuries. The department said on Aug. 19 it would raise the cap on liquidity-support buybacks of Treasuries with maturities of 10 to 30 years to more than $4 billion per operation from $2 billion. Kim Min-seung, head of the research center at Korbit, said markets read the move as a signal that could calm anxiety in the long-dated Treasury market and improve liquidity conditions for risk assets.

Supportive Regulatory Backdrop Emerges

A sharp reversal in spot ETF flows also helped fuel the rally. SoSoValue, a digital-asset data provider, said U.S. spot Bitcoin ETFs returned to net inflows on Aug. 17 after a recent stretch of outflows. Inflows over the past three days totaled $1.00405 billion.

Expectations for reduced regulatory uncertainty in the U.S. also supported buying. President Donald Trump met with crypto industry officials at the White House a day earlier and urged passage of the Clarity Act, which would classify digital assets as securities or commodities and define regulators' authority. Earlier, the U.S. Securities and Exchange Commission released a crypto rule proposal that would open a path for U.S. companies to raise funds through token issuance.

That also helps explain Ether's stronger performance. Ethereum is the leading blockchain for staking, decentralized finance, stablecoin transactions and token issuance. Clearer rules could boost services and trading activity built on Ethereum.

How Much Further Can It Rise?

Views on the outlook were mixed. Geoff Kendrick, Standard Chartered's global head of digital-asset research, said the Treasury move was “the kind of government intervention that Bitcoin likes best” and that Bitcoin could reach $100,000 by year-end.

Some investors also see a significant chance of short-term profit-taking. The Treasury's long-bond buybacks do not directly expand the money supply, and many market participants believe the latest surge was driven largely by forced buying in the futures market. In futures trading, investors betting on a decline can borrow coins and sell them first, then buy them back later at lower prices to profit. If prices rise instead, they have to repurchase the coins to limit losses. That wave of buying appears to have amplified the rally.

Cho Mi-hyun