Analysis: The current Bitcoin rally has been driven by a surge in regulatory optimism towards crypto, an expansion in the US bond repurchase program, and short covering.

BlockBeats News, August 20th, according to Bloomberg, as industry executives gathered at the White House and market regulation optimism increased, Bitcoin broke out of a months-long trading range on Wednesday, surging as much as 8% to around $69,500, marking the largest gain since March and reaching the highest level since early June. Trump is expected to hold a meeting with executives from Coinbase, Payward, and Blockchain.com.

IG's Chief Technical Analyst, Axel Rudolph, stated that the rally towards $70,000 was triggered by short covering, indicating that buyer confidence is recovering. However, whether the market can sustain momentum and further challenge the $75,000 region still faces a key test. Bitcoin on Wednesday also reclaimed the 100-day and 200-day moving averages. Coinglass data shows that the rapid surge triggered over $1 billion in liquidations within one hour, with the past 24-hour liquidation volume at around $1.5 billion.

On the regulatory front, the U.S. SEC proposed this week to require exemptive relief for some digital asset issuers from registration statements to assist companies in their early-stage and fundraising efforts. Meanwhile, the U.S. Treasury announced that it will at least double the size of liquidity support repurchase operations for 10 to 30-year Treasury bonds, pushing down U.S. bond yields and the dollar.

FalconX's Co-Head of Markets, Joshua Lim, mentioned that the market has been filled with selling pressure over the past few weeks, but Bitcoin has remained resilient in the $60,000 low area, subsequently driving a shift in market sentiment and narrative. Deribit data shows that Bitcoin options open interest is mainly concentrated around $60,000 put options and $70,000 call options.