Bitcoin climbed to around 67,500 dollars on Wednesday, gaining more than 5 percent over 24 hours and triggering a broad recovery across digital assets. The move follows weeks of heavy selling pressure and deeply negative market sentiment that had left positioning skewed toward short bets.
The rebound extended beyond bitcoin, with major altcoins posting double digit gains. Ether advanced roughly 10 percent, moving back above the 2,000 dollar level for the first time in several days. Solana, Dogecoin, Cardano and Chainlink also recorded gains of around 10 percent or more, outperforming bitcoin during the session.
Market data indicates that the rally forced the liquidation of more than 300 million dollars in leveraged bearish positions across crypto derivatives markets within a single day. Such liquidations often amplify upward price movements when short sellers are compelled to buy back assets to close positions. Despite the rally, perpetual futures funding rates have remained relatively subdued, suggesting that the bounce is not yet driven by aggressive leveraged long speculation.
Investor sentiment had been extremely cautious throughout much of February. The widely followed Crypto Fear and Greed Index remained in extreme fear territory for an extended period, reflecting broader concerns about macroeconomic uncertainty and slowing liquidity conditions. Negative funding rates in recent weeks signaled that short positions had become crowded, creating the conditions for a potential short squeeze.
Crypto related equities also moved higher alongside digital assets. Shares of Circle rose sharply after the company reported stronger than expected quarterly earnings. Coinbase, Strategy and Galaxy recorded gains between 5 and 6 percent, while several publicly listed bitcoin mining companies extended their recent recovery.
The advance coincided with modest gains in traditional equity markets. Major US indices including the S and P 500 and the Nasdaq 100 traded higher during the session, providing a supportive backdrop for risk assets. Technology and software stocks also rebounded, helping improve overall market sentiment.
Additional indicators suggest a tentative return of US based buyers. The Coinbase Premium Index, which measures the price difference between bitcoin on Coinbase and global exchanges, turned positive for the first time in over a month. A positive reading is often interpreted as a sign of renewed institutional or domestic demand.
US spot bitcoin exchange traded funds also recorded their largest single day inflows since early February, attracting more than 250 million dollars. Analysts view ETF flows as a key gauge of institutional participation in the digital asset market.
While volatility remains elevated, the latest rebound highlights how quickly sentiment can shift when bearish positioning becomes stretched and liquidity conditions stabilize.
