Bitcoin Tops $68,000 as Short Liquidations Hit $1.7 Billion

Bitcoin traded above $68,000 and ether gained 9% on Wednesday, forcing $1.91 billion of leveraged positions to close, according to Coinglass. Shorts made up $1.74 billion of that total, roughly eight times the volume of liquidations recorded over the previous 24 hours.

The trigger came from the bond market. The U.S. Treasury said Wednesday morning it will at least double the size of its buybacks of long-dated debt, reversing a selloff that had pushed the 30-year yield to its highest daily close since June 2007. Bitcoin had traded between roughly $59,000 and $67,000 for seven weeks, and positioning was heavily short into the break.

Bitcoin last changed hands at $68,605, up 5.8% over 24 hours, after moving between $64,124 and $68,982, CoinGecko data shows, while Ether was at $2,086, up 9%. XRP added 6.9% to $1.07; Solana rose 6.5% to $81.67; BNB gained 2.3% to $619.

Total crypto market value stood at $2.41 trillion, up 5.1%, on $75.7 billion of 24-hour volume, with bitcoin dominance at 57.1%. DeFi total value locked rose to $78.1 billion from $74.7 billion on Monday, according to DefiLlama.

Bitcoin remains 45% below its October 2025 record of $126,080. Ether is 58% below the $4,946 it reached in August 2025.

Treasury Doubles The Buybacks

The Treasury said in a statement that the maximum size of its liquidity support buyback operations in the 10-to-20-year and 20-to-30-year nominal coupon sectors will rise from $2 billion per operation to at least $4 billion. The change takes effect Sept. 9 and runs through Nov. 4, when the next quarterly refunding is scheduled.

"This increase in buyback operation sizes reflects Treasury's desire to provide greater liquidity support in longer-dated nominal sectors where there is consistent strong sponsorship from market participants," the department said.

The 30-year Treasury yield fell to 5.21% from Tuesday's close of 5.285%, touching 5.183% during the session. The 10-year yield dropped to 4.66% from 4.71%. The dollar index fell 0.8% to 98.86 and gold futures traded at $4,553 an ounce. The 30-year had closed at 5.31% on Aug. 17, its highest daily close since June 2007, according to Federal Reserve data.

Equities did not follow. The S&P 500 was down 0.3% at 7,719 at the time of writing.

Crypto lagged the bond reaction by about three hours. Bitcoin was at $64,448 at 8:30 a.m. ET and still $64,989 two and a half hours later. The move came between 11 a.m. and noon ET, when bitcoin went from $65,888 to $68,529.

Shorts Pay The Price

Of the $1.91 billion liquidated over 24 hours, $1.78 billion closed within a four-hour window, Coinglass data shows. Long liquidations totaled $173 million. A total of 122,893 traders were liquidated, and the largest single order was a $48.8 million bitcoin position on Hyperliquid.

Bitcoin accounted for $1.10 billion of short liquidations against $33.9 million of longs. Ether accounted for $463 million of shorts against $46.8 million of longs. By venue, Binance recorded $530 million of liquidations over four hours, Hyperliquid $513 million and Bybit $303 million.

Bitcoin futures open interest rose 5.4% over 24 hours to $52.2 billion, and ether open interest rose 7.4% to $28.4 billion, with CME's ether contracts up 12.7%. Funding rates stayed modest at 0.0051% for bitcoin and 0.0084% for ether on an open-interest-weighted basis, indicating traders had not yet crowded into long positions.

U.S. spot bitcoin ETFs took in $297.5 million on Aug. 17 and $189.3 million on Aug. 18, according to Farside Investors. The two days reversed the $385.2 million of net outflows recorded over the week to Aug. 14. Spot ether ETFs took in $71.4 million on Aug. 18, their largest daily intake since Aug. 6.

Rate Market Says Hike

The rally came with the rates market pricing a Federal Reserve increase rather than a cut. Polymarket traders, on $38.3 million of volume, put the odds of no change at the Sept. 15-16 meeting at 70.5%, a quarter-point increase at 28.5% and a quarter-point cut at 1.25%.

The Fed held its target range at 3.50% to 3.75% on July 29 in a 9-3 vote. Beth Hammack, Neel Kashkari and Lorie Logan all dissented in favor of a quarter-point increase. Minutes from that meeting are due at 2 p.m. ET Wednesday.

Chair Kevin Warsh speaks at the Kansas City Fed's Jackson Hole symposium on Aug. 27-29, his first as chair. The theme is "Financial Innovation: Implications for Payments and Policy."

Regulation In The Background

The Securities and Exchange Commission proposed Regulation Crypto Assets on Tuesday, creating two registration exemptions for token offerings — one for up to $5 million over four years, another for up to $75 million per 12-month period — plus a conditional safe harbor that removes the "investment contract" label from a token once the issuer completes the managerial efforts it promised. The Defiant covered the proposal here.

Governance tokens outpaced the market on Wednesday, though not by much. Uniswap's UNI rose 7.2% to $3.58, Lido DAO's LDO gained 8.1%, Sky's SKY added 6.9% and PancakeSwap's CAKE rose 7.5%, against 4.3% for Aave and 2.8% for Compound.

Bitway Round-Trips A Record

Bitway, a basis-trading yield product on BNB Chain, was the day's largest mover among the 150 largest tokens by market value. BTW hit a record $0.7453 at 9:36 a.m. UTC, then gave back 34% to $0.4912. The token is up 124% over seven days and trades at a $1.32 billion market value against a $4.88 billion fully diluted valuation, with 27% of its 10 billion supply in circulation. Bitway Earn holds $78.1 million in total value locked, all of it on BNB Chain.

Gnosis rose 11% after a Snapshot vote closed Wednesday approving GIP-153, which converts Gnosis Chain from a standalone layer 1 into a ZK-proven rollup settling on Ethereum. The proposal passed with 123,158 GNO in favor and 115 against across 54 voters. It also unlocks the roughly 350,000 GNO — about 27% of supply — staked by the chain's existing validator set, and ends treasury staking subsidies. Genesis is targeted for December 2026 or January 2027. The Defiant reported on the Ethereum Economic Zone framework when Gnosis and Zisk introduced it.

Zcash gained 8.8% to $559.66 after Cypherpunk Technologies said Tuesday it had acquired what it called the world's largest Zcash mining fleet, roughly 4.2 GSol/s or about 18% of network hashrate, in a $33.33 million equity transaction with Winklevoss Capital affiliates. The Nasdaq-listed company holds 323,394 ZEC, about 1.92% of circulating supply. "Zcash mining shows a striking similarity to Bitcoin mining in 2016 and provides exciting growth potential for Cypherpunk," said Kevin Zhang, the company's head of mining. Other privacy tokens did not follow: Monero rose 0.7%, Dash 2.7% and Decred 0.2%, all well below the market's 5.1%. The Defiant covered Cypherpunk's Zcash treasury when the Winklevoss twins disclosed it.

Pump.fun's PUMP rose 9.4%. The protocol generated $7.41 million of revenue over the trailing seven days and $1.16 million over 24 hours, according to DefiLlama, with most of the weekly total directed to buybacks and burns under the model the team announced last year. Cumulative PUMP buybacks passed $400 million earlier this year.

Supply Schedules Sink Losers

STABLE, the token of the layer 1 network that uses USDT as its gas asset, fell 8.6% and is down 13.3% over seven days. The project published updated tokenomics on Aug. 17. Total supply is fixed at 100 billion tokens, of which 25.5 billion circulate, giving STABLE a $719 million market value against a $2.81 billion fully diluted valuation. Team and investor allocations, 25% of supply each, release nothing for the first 24 months, according to Stable's documentation. The token is 35% below the $0.0432 it reached in May.

MemeCore's M rose 9.7% in price on Wednesday while its market value rose 86%, to $2.81 billion. The gap comes from supply: CoinGecko now counts 2.26 billion M in circulation, up from roughly 1.34 billion, an increase of about 926 million tokens in a day. The M contract on BNB Smart Chain shows a total supply of 1.16 billion tokens, onchain data shows. MemeCore has not published an explanation for the increase. The token trades on $7.4 million of daily volume, or 0.3% of its market value.

Morpho slipped 1.6% against a rising market after gaining 8.7% over the previous week.