Bitcoin tops $72,000 in a historic short squeeze

Bitcoin just had one of its wildest weeks in years. Prices jumped past $72,000, the highest since May. That came after the Treasury said Thursday it would double its long-term bond buybacks. The move pushed down bond yields and sent investors chasing riskier assets. It also triggered a short squeeze. Traders who bet on falling prices got forced to buy back in at a loss. That pushed the price up even further.

CoinDesk put the damage near $3 billion in short positions wiped out in a single day. That's the biggest such wave since at least 2021. It's not the same as $3 billion in new buyers showing up. It's traders being forced to close bad bets. That mechanically pushes the price higher without real new demand behind it. The rally also lines up with President Trump pushing Congress to pass the Clarity Act, a crypto bill. That gave traders another reason to pile in.

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Does this rally hold once the forced buying stops? Short squeezes tend to fade fast once panicked sellers are gone. Bitcoin's price swung by thousands of dollars within the same week. Whether $72,000 sticks now depends on real buyers showing up to replace the ones who got forced in.