The past 24 hours have been among the most volatile in recent months. While most market participants were preparing for a continued sideways trend, quotes made a sharp upward surge, forcing even the most experienced traders to reassess their positions. A powerful influx of capital into risk assets was recorded, and the dynamics of the top cryptocurrencies by market capitalization point to a shift in market sentiment.
Sharp Reversal: Bitcoin and Ether Head Higher
The leading cryptocurrency demonstrated impressive momentum, jumping from $64,000 to nearly $70,000 in a day. As of this morning, BTC is trading around $69,330, up 8.09%. Such a rapid impulse could not help but affect altcoins as well. Ether showed an even more striking result, soaring 17.42% to $2,241. Overnight, the second-largest cryptocurrency by market cap updated local highs, climbing from $1,900 to $2,280.
In the top 20 by market capitalization, there are almost no "red" positions left. The growth leaders were Hyperliquid (HYPE) with a gain of 22.25%, Solana (SOL) — 10.53%, and XRP — 10.41%. Dogecoin also strengthened by 6.80%. In the broader top-100 list, Lighter (LIT) stood out, adding 24.12%, followed by the aforementioned HYPE, Official Trump (TRUMP) with 17.93%, and Aerodrome Finance (AERO) with 16.60%. The only exceptions to the overall positive trend were a few tokens like STABLE, which lost 3.84%.
Institutional Demand and a Wave of Liquidations
The key driver of the rally was a significant inflow of funds into spot Bitcoin ETFs. In a single day, the funds attracted $517.19 million, while Ether products added $189.15 million. This indicates a return of confidence among institutional investors. However, such a sharp move has a downside: positions worth $2.99 billion were liquidated over the day. Short sellers bore the brunt of the impact, losing $2.74 billion. The largest liquidation order was recorded on Hyperliquid for the BTC-USD pair, amounting to $48.80 million.
The reason for such a sharp reversal was the minutes from the July FOMC meeting, as well as statements by the US President regarding BTC and HYPE. The market perceived these signals as a reason to buy, and capital flowed into risk assets.
Regulatory News and Corporate Restrictions
Among the significant overnight events, it is worth highlighting that BitGo became the first foreign crypto firm to receive a VASP license in South Korea. This is an important step for the legal custody and transfer of digital assets by institutional clients in the country. Additionally, the OKX exchange restricted employee access in Hong Kong to Anthropic's AI model Claude. The reason was a potential violation of regional access rules, and the exchange's monthly spending on AI models ranges from $6 to $8 million.
My view: The current surge is a classic example of a short squeeze against a positive macroeconomic backdrop. However, one should not forget that the FOMC minutes indicate that inflation risks remain above the 2% target. This means the sustainability of the current rally will depend on the market's ability to hold above key levels, not on one day's euphoria. Keep a close eye on the reaction at the $70,000 level — it is a psychologically important threshold.