Bitcoin returned to $67,500 during Wednesday’s US morning session and gained more than 5% over the past 24 hours as deeply bearish positioning across the crypto market began to relax.
The move sparked a broader relief rally across altcoins. Ethereum’s ether (ETH) surged 10%, regaining the $2,000 level for the first time in a week. Solana (SOL), , and Chainlink each advanced more than 10%, outperforming bitcoin and the broad market benchmark CoinDesk 20 Index.
Wednesday’s rally follows a period of extremely negative sentiment across the market. The Crypto Fear & Greed Index, a popular sentiment gauge, has been hovering in extreme fear for most of February.
Perpetual futures funding rates – the periodic payments between long and short traders – had also turned negative several times in recent weeks. This means that short sellers have paid long to maintain positions, a sign that bearish bets had been crowded out. Such setups often leave markets vulnerable to sharp pressure higher when prices begin to rise.
The rally has liquidated over $307 million in leveraged bearish bets across crypto derivatives over the past 24 hours, CoinGlass data shows. In particular, bitcoin perpetual funding rates remain below neutral even in the midst of the rally, suggesting that the move is not driven by aggressive leveraged speculation.
Crypto stocks rise
Crypto-related stocks also joined the advance. Stablecoin issuer Circle ( CRCL ) rose 20% after an earnings beat, while Coinbase ( COIN ), bitcoin tax firm Strategy ( MSTR ) and Galaxy ( GLXY ) rose 5%-6%. Bitcoin miners — increasingly tied to AI infrastructure themes — extended their rebound, with Bitfarms (BITF), Bitdeer (BTDR) and MARA Holdings (MARA) leading gains.
Many crypto-linked stocks had built up significant short interest from hedge funds, noted 10x Research’s Markus Thielen, leaving them poised for a sharp reversal.
Improving risk appetite across traditional markets has provided a favorable backdrop for the crypto bounce. The S&P 500 and the tech-heavy Nasdaq 100 were up 0.6% and 1.1%, respectively, in early trading hours. The software sector, battered by AI fears, extended its gains, with the iShares Expanded Tech-Software Sector ETF ( IGV ) rising another 2% during the session.
Early signs of US buyers returning
For the first time in over 40 days, the Coinbase Premium Index has turned positive again. This index tracks the price difference between bitcoin on Coinbase, a major US exchange, and the broader global market average. It is widely seen as a gauge of US capital flows, institutional participation and overall market sentiment.
While the MSTR to IBIT ratio is up 12% year-to-date, indicating that the Strategy has outperformed BlackRock’s ETF. This relative strength points to continued risk appetite, even though bitcoin is down 25% this year.
In addition, US spot bitcoin ETFs recorded $257.7 million in inflows on Tuesday, the largest daily amount since February 6.
