Original | Odaily Planet Daily (@OdailyChina)

Author｜jk

OKX market shows that, after exactly 100 days, BTC has once again risen above $80,000, currently reported at $80,700.

In the past week, the bulls have sounded the counterattack horn: BTC violently rose from $64,000, with the highest weekly increase reaching 25%, showing a strong momentum; ETH closely followed, continuously breaking through several key resistances, currently stabilizing at $2,500, and the ETH/BTC exchange rate even touched 0.0334, reaching a new high since February this year; altcoins are also firing on all cylinders, with an average weekly increase of over 30%, SOL returning to the $100 mark, and HYPE breaking through $83, setting a historical record.

All signals point to the same narrative: the summer of crypto is knocking at the door.

However, beneath the revelry, the divergences are equally sharp. One side cries, "A new bull market has started," while the other fears this is merely a technical rebound driven by short covering, which could stop at any moment. Odaily Planet Daily will dissect the underlying logic of both sides using data to reveal the truth of this game.

Objective Data: Sentiment, Capital Flow, and Key Indicators

Last week, the Fear and Greed Index approached the "Extreme Greed" state. According to Coinglass data, the cryptocurrency Fear and Greed Index is currently at 74, nearing the threshold of the "Extreme Greed" zone, the highest level since December 2024. Just a week ago, the index hovered near the "Fear" zone, and this dramatic reversal of sentiment itself is a notable warning signal. Historically, periods characterized by widespread retail FOMO have often been windows of intensified short-term volatility.

Cryptocurrency Fear and Greed Index, source: Coinglass

At the same time, ETF funds have begun to flow back strongly: According to SoSoValue data, for the week of August 21, the US spot Bitcoin ETF recorded a net inflow of $1.92 billion, the largest single-week inflow since the peak of the last bull market in October 2025. Combined with Ethereum spot ETFs, both raised a total of $2.6 billion within a week, tripling the trading volume compared to previous weeks, setting the strongest capital inflow record in about 10 months. BlackRock's IBIT remains the main driver of capital inflow, with cumulative net inflow exceeding $62 billion.

Net inflow of spot Bitcoin ETF, source: SoSoValue

The core driving factors of this round of market are mainly derived from a triple resonance of favorable policies from the US.

First, the Trump administration held a cryptocurrency meeting at the White House, sending strong support signals. On August 19, Trump personally presided over the meeting, inviting industry executives from Coinbase, Ripple, Kraken, and Robinhood, as well as leaders from the SEC and CFTC to join. At the meeting, Trump explicitly stated that the government had "completely ended the war on cryptocurrencies" and urged Congress to quickly pass a fair version of the "CLARITY Act" to clarify regulatory frameworks for digital assets and ensure that the US maintains a leading global position in Bitcoin and cryptocurrencies. He also revealed that discussions have been held on plans to accumulate large amounts of Bitcoin and other cryptocurrencies as reserves. This high-profile statement directly boosted market expectations for a friendly policy environment and strengthened the confidence of both institutions and retail investors to buy.

Secondly, the SEC simultaneously eased cryptocurrency restrictions, injecting substantial compliance space into the industry. On August 18, the SEC proposed the "Regulatory Framework for Crypto Assets," marking its first permanent rules specifically tailored for crypto asset financing. The proposal established two exemption paths: startups can raise up to $5 million within four years, while the general financing channel allows up to $75 million per year, supported by principled information disclosure and safe harbor mechanisms, potentially allowing some tokens to detach from being classified as securities after fulfilling management commitments. This move significantly lowered compliance financing thresholds, attracted capital back to the US, alleviated previous uncertainties in regulation that suppressed innovation, and provided clear predictions for market rules.

Finally, the US Treasury announced an expansion of the treasury bond repurchase program, improving the risk asset environment from a macro perspective. The Treasury decided to at least double the liquidity support repurchase scale for bonds maturing in 10 to 30 years, raising the single transaction from $2 billion to at least $4 billion, effective September 9. This move aims to respond to soaring long-term bond yields and liquidity pressure, directly pushing down US bond yields and weakening the dollar. In a context of easing interest rate environments and dollar depreciation, capital tends to flow into risk assets like Bitcoin, forming a resonance effect of "de-dollarization" and "devaluation trading," further amplifying the upward momentum in the cryptocurrency market.

These three factors overlap: policy friendliness provides narrative support, regulatory easing opens growth space, and macro liquidity improvement provides capital impetus. The accumulation of multiple benefits, along with a large number of short positions accumulated in the previous market, ultimately triggered a rare clearing wave in cryptocurrency history. The Kobeissi Letter estimates that about $3.5 billion of leveraged positions were liquidated in the past 24 hours, of which over 90% came from shorts. Many analysts point out that this round of rebound is largely driven by "short covering," rather than organic inflow of new bullish funds.

According to CryptoQuant data, before this breakout, Bitcoin prices had long been below the cost basis for short-term holders (around $68,700), and this rise pushed the price above that cost line for the first time; short-term holders subsequently transferred 43,300 Bitcoin for profits to exchanges, marking the largest profit-taking since 2026, while the SOPR indicator for short-term holders rose to 1.01, the highest since April.

Bullish Argument: Strive CEO Claims "The Strongest" Cycle in History

The bullish camp mainly believes that the long-term macro will certainly lead to a rise in Bitcoin, and the trend of the next cycle has already begun to show.

Matt Cole, chairman and CEO of asset management firm Strive, stated on social media that Bitcoin's strong performance against the dollar and gold suggests that the next Bitcoin cycle "will be the strongest ever." The core of Cole’s argument is the "scarcity narrative": in an AI-driven era of abundance, the market's pursuit of scarce assets is becoming a powerful structural tailwind, driving more capital towards rare financial assets like gold, silver, and Bitcoin.

He specifically pointed out that the current Bitcoin-to-gold ratio is 16.73 ounces of gold per Bitcoin, the highest level since May, reflecting that Bitcoin has simultaneously achieved breakthroughs against both the dollar and gold this week, and this breakout is "incredibly explosive." He believes that when Bitcoin becomes the strongest-performing asset in capital flows, it will attract a disproportionate amount of incremental capital inflow. Cole also admitted that a short-term correction is difficult to avoid, but he predicts that buyers will actively enter to buy on dips, and these structural forces make him "more bullish on Bitcoin than ever before."

Other analysts also hold relatively optimistic views. Zeus Research analyst Dominick John believes that the rebound will continue in the short term, driven by the reflow of ETF funds and improvements in macro liquidity; he sets a target of first reclaiming $80,000, and if the breakthrough is confirmed effective, then looking towards the $85,000–$90,000 range, and if ETF inflows and macro liquidity continue to exert strength, $100,000 is also possible.

Ray Dalio, founder of Bridgewater Associates, reiterated his positive view on Bitcoin in a recent article published on August 21. Dalio believes that a series of phenomena in the US bond market recently, such as Japan reducing its holdings of US debt, long-term US bond yields weakening alongside the dollar, and Treasury Secretary Yellen announcing an expansion of the bond repurchase program, all align with the debt cycle pattern he described in his book "How Countries Go Bankrupt." Against the backdrop of a crisis facing US bonds, he advocates reducing bond positions and allocating 10%–15% of portfolios to gold, and holding "a bit of Bitcoin."

Geoff Kendrick of Standard Chartered has raised his risk assessment, believing that the possibility of retesting the $126,000 historical high within the year is "greater," and that his previous target of $100,000 at the year-end "may have been set too low."

Bearish and Cautious Argument: Beware of Leveraged Driven False Breakouts

In contrast to the optimism of the bullish camp, multiple analysts emphasize that the rebound may hide a weak support level.

At the macro level, the Federal Reserve, under the leadership of new Chair Kevin Warsh, maintains a hawkish stance, voting 9 to 3 to keep interest rates unchanged at the July meeting, with three votes even leaning towards a rate hike; meanwhile, the July CPI remains as high as 3.4%. This stands in stark contrast to the past bull market logic driven by interest rate cuts. Once there is a rate hike, Bitcoin may give back all its gains, which is one of the core bases in the bearish argument.

Rachael Lucas, a cryptocurrency analyst at BTC Markets, stated that understanding the driving factors behind this historical surge is crucial. She pointed out that such intense momentum is often the result of short covering, spot demand, and derivative positions working together, rather than a single catalyst; what truly needs attention is not the numbers of the increase itself, but whether the spot trading volume and ETF fund inflows confirm this rise, or whether this rise is indeed the result of leverage amplification. Lucas further noted that a spot-driven rebound could provide stronger structural support for the next rise, while a leverage-heavy market could make the market more susceptible to severe pullbacks.

She advises investors to closely monitor spot ETF fund flow data, as this data has a certain lag, and at the same time, to keep track of derivative positions, funding rates, and open contracts size, as these indicators can reflect how much leverage is accumulated in this market. She specifically warns that following such a scale of market movement, if the funding rate overheats and open contracts remain high, it often serves as an early warning signal of a leveraged-driven pullback; broader macro risks, especially if interest rate expectations undergo a hawkish repricing or the dollar strengthens, may also suppress market enthusiasm.

Gold proponent Peter Schiff stated on platform X that Bitcoin's breakout above $72,000 is a "false breakout rather than a true breakout," bluntly stating "sell Bitcoin, buy gold." He believes the market has misread the signal of the US Treasury's unexpected expansion of the repurchase plan: investors have always believed that the return of a loose monetary environment would raise both gold and Bitcoin, but in fact, "only half of that is correct." He suggests that the real benefactor will be gold, not Bitcoin, and that this rebound is essentially a mechanical short squeeze, rather than a breakthrough driven by real demand. However, records show that Schiff has repeatedly predicted Bitcoin's "death" or crash since 2011, and his previous predictions have not had a high accuracy rate.

Conclusion: Short-term Risk of Liquidating Leverage Downturn, but Long-term Bullish

In summary, the market currently shows a typical "bull-bear entangled" pattern: on one hand, strong reflow of ETF funds, on-chain valuation indicators show that the coin price is not at historical peak areas, along with the structural bull logic provided by figures like Strive CEO, all support the judgment that "this is not a short-term peak but a support base for a new round of rise"; on the other hand, the driving force behind this rebound mainly comes from short covering rather than new buying, market sentiment has rapidly shifted to "extreme greed," and macro factors such as the Federal Reserve maintaining a hawkish stance are risk factors that cannot be ignored.

From a technical position, $80,000 is recognized as a key short-term threshold by the market. If it can effectively reclaim and stabilize, the $85,000–$90,000 range will become the next target, and $100,000 is not out of reach; however, if it fails to stabilize at this level under the conditions of weak ETF fund flows or a resurgence of macro risks, the support range of $65,000–$69,000 (corresponding to the 200-day moving average and short-term holder cost basis) may become a more realistic pullback target.

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