Bitcoin Climbs Above $81K as Shorts Unwind

Bitcoin Reclaims the $81,000 Level

Bitcoin staged a strong recovery on September 18, rising above $81,000 after trading around $76,400 the previous day. The move marked the first time since September 7 that the cryptocurrency had traded above the $80,000 threshold.

Bitcoin reached an intraday high of $81,702 before trading at approximately $81,309.40 later in the session, representing a daily increase of about 5.62%.

The rally came despite a challenging environment for risk-sensitive assets. The Federal Reserve had recently increased interest rates by 25 basis points, while the Bank of Japan also raised its benchmark rate by a quarter point to 1.25%, its highest level in three decades.

ETF Demand Helps Support Bitcoin

Bitcoin initially weakened toward the $75,000-$76,000 area following the latest central-bank decisions. However, the anticipated selling pressure after the Bank of Japan's rate hike did not develop as strongly as expected.

Demand from U.S. spot Bitcoin exchange-traded funds also provided support. These funds attracted approximately $159 million in net inflows on September 17, adding fresh buying pressure to the market.

Short Liquidations Accelerate the Rally

The recovery gained additional momentum as bearish leveraged positions were rapidly closed.

Approximately $192 million worth of leveraged cryptocurrency positions were liquidated over a single hour. Short positions represented more than $183 million of those liquidations, while Bitcoin shorts alone accounted for roughly $119 million.

This wave of forced buying helped amplify Bitcoin's upward move and contributed to the sharp rebound from its recent lows.

U.S. Crypto Regulation Remains Uncertain

Regulatory developments continue to influence the cryptocurrency market. The U.S. Senate did not move forward with the CLARITY Act during the week, keeping uncertainty surrounding the country's crypto regulatory framework in place.

Meanwhile, the Commodity Futures Trading Commission submitted another cryptocurrency market proposal to the White House Office of Management and Budget. Details of the proposal had not yet been made public.

The Securities and Exchange Commission has also introduced an innovation exemption. Under the initiative, eligible platforms may receive a five-year pathway to provide certain onchain trading services involving tokenized stocks without registering as securities exchanges.

Separately, the CFTC announced relief for some software providers that connect customers with regulated derivatives markets, although the exemption comes with specific conditions.

Altcoins Also Post Strong Gains

Bitcoin's recovery was accompanied by broad gains across major alternative cryptocurrencies.

Ether increased 6.37% to $2,619.81, while XRP advanced 8.97% to $1.4238. Solana climbed 10.54% to $113.57, and BNB added 1.78% to reach $762.

Cardano rose 8.93% to $0.2330, while Dogecoin gained 6.62%. Among major meme tokens, TRUMP was largely unchanged, whereas Shiba Inu advanced 3.98%.

Market Expectations Remain Mixed

Despite Bitcoin's rebound, traders remain cautious about the cryptocurrency's next major move. Some market participants are positioning for another rise, while expectations become less confident at substantially higher price levels.

According to the figures cited in the original report, Myriad traders assigned an 84% probability to Bitcoin reaching $84,000 before declining to $55,000. On Polymarket, the probability of Bitcoin reaching $90,000 during the year stood at 59%, while the figure for $100,000 was 25%.

At the same time, the possibility of a decline remained significant, with Polymarket assigning a 48% probability to Bitcoin reaching $70,000 before the end of the year.