Crypto Equities Rally as Bitcoin Charges Toward $70K, Triggering Billion-Dollar Short Squeeze
Strategy, Coinbase, and other crypto-linked stocks posted their strongest daily gains of summer as Bitcoin surged higher and forced traders to cover bearish positions.
Crypto Stocks Post Strongest Summer Rally
Crypto-linked equities staged their most impressive single-day performance of the summer on Wednesday. Bitcoin treasury firm Strategy (MSTR) led the charge, climbing 11.95% to $103.58, while exchange operator Coinbase (COIN) followed with a 9.05% jump to $159.47. Stablecoin issuer Circle (CRCL) gained 9.44% to reach $78.50, and Ethereum-focused treasury BitMine (BMNR) added 9.68% to close at $20.05. During intraday trading, the rally intensity peaked significantly higher, with Strategy touching $106.90 (a 13.07% gain from open), Coinbase reaching $165.74 (12.37% up), Circle hitting $81.22 (10.10% higher), and BitMine climbing to $20.90 (12.79% above open).
Bitcoin’s Surge Triggers Liquidation Cascade
The equity surge tracked Bitcoin’s powerful move toward the $70,000 level, unleashing significant market disruption. In a single hour, Bitcoin’s price action liquidated more than a billion dollars worth of bearish crypto derivative positions, creating a squeeze across markets. This liquidation extended beyond crypto derivatives traders—Strategy and Coinbase, which rank among Wall Street’s most-shorted large-cap stocks, drew additional pressure from equity short sellers forced to cover positions in a rising market. Coinbase currently holds the distinction of being the fifth most-shorted stock in the financial sector, amplifying the impact of Wednesday’s advance.
Macro Support Fuels Risk Asset Rally
The stock surge occurred alongside broader tailwinds for risk assets. According to the U.S. Treasury, as reported by Decrypt, the government announced plans to at least double the size of its long-bond buyback program beginning in September—a liquidity-easing move that benefited risk assets broadly and contributed to a crypto market expansion of more than 5% during the trading session. The timing proved significant, arriving hours before a scheduled White House meeting involving President Trump, SEC and CFTC leadership, and crypto executives to discuss market-structure rules, alongside the release of the Federal Reserve’s July meeting minutes.
The tight connection between these stocks and Bitcoin prices underscores crypto’s central role in their business models. Strategy functions almost as a leveraged play on Bitcoin itself, holding 840,447 BTC and $4.8 billion in cash according to its latest weekly filing. Coinbase generates revenue from trading volume, Circle earns yield from USDC stablecoin reserves, and BitMine accumulates Ethereum—all businesses intimately tied to broader crypto adoption and market performance. Strong movements in crypto equities demonstrate institutional investors’ deepening engagement with digital assets as both operational businesses and portfolio positions, signaling confidence in the broader crypto ecosystem.
Source: U.S. Treasury, via Decrypt. Not financial advice.