Bitcoin Holds Near $78K as Gold Climbs and Altcoins Pause After Huge Rally

• Bitcoin was largely unchanged Monday after a roughly 24% weekly rally, as markets took a breather following a Treasury buyback announcement that helped wipe out more than $3 billion in short positions.
• BTC was trading near $77,800 Monday morning, little changed from midnight UTC as investors digested one of Bitcoin’s strongest weekly advances in more than three years.
• Bitcoin had climbed about 24% last week from below $63,000, marking its best weekly performance since March 2023. The move came after the U.S. Treasury doubled its buybacks of longer-dated bonds, breaking Bitcoin out of a six-week range and triggering more than $3 billion in short liquidations within 24 hours.
• While crypto and gold rallied together last week, equities lagged. Gold added about 0.8% Monday and remained close to record levels as Treasury Secretary Scott Bessent’s debt-management plans continued to pressure longer-term bond yields. The 30-year Treasury yield briefly reached a 19-year high before retreating following the buyback announcement.
• Most altcoins were flat to slightly lower from midnight, pointing to consolidation rather than a meaningful reversal. Bitcoin dominance remained around 59.2%, while the Altcoin Season Index edged up to 42 from 33 on Friday but remained firmly tilted toward Bitcoin. The previous week’s altcoin gains were concentrated in select tokens rather than representing a broad market rotation.

Derivatives Positioning

• Bitcoin futures open interest falls as spot prices rise: BTC futures open interest dropped to a two-month low of 715,000 BTC from 762,000 BTC on Aug. 18, according to CoinGlass. The divergence suggests last week’s rally was primarily driven by spot purchases and short-covering rather than traders piling into leveraged long positions.
• Major altcoins show similar positioning: ETH, SOL and XRP futures also saw open interest decline while their prices advanced, pointing to a similar spot-led move.
• ZEC sees open interest rise alongside price: Privacy-focused Zcash saw futures open interest increase to 2.24 million tokens from 1.81 million a week earlier. Its price climbed more than 70% over the same period. Rising open interest alongside higher prices is generally viewed as confirmation of strengthening momentum.
• ZEC buyers show the strongest conviction: Zcash recorded the most positive OI-adjusted weekly cumulative volume delta among major cryptocurrencies, indicating aggressive buyers were driving the move through market orders rather than relying primarily on passive limit orders.
• Funding rates show little overheating: Annualized funding rates for Bitcoin, Ether and other major tokens remained around 10%. While the figures indicate a preference for bullish positions, they are not considered unusually elevated.
• Bitcoin implied volatility jumps: BTC’s 30-day implied volatility, measured by the BVIV index, climbed to an annualized 47% from 36% a week earlier. Such a sharp increase is notable because implied volatility is often treated as a market “fear index” and typically rises during selloffs. Ether’s EVIV measure has also climbed sharply.
• Options market signals cautious optimism: Short-dated call-put skew on Deribit turned positive, meaning bullish calls are now more expensive than puts. However, the latest 24-hour volume shows mixed positioning, with the $70,000 put among the most actively traded contracts alongside several calls. The overall picture suggests optimism, but not outright bullish conviction.

Token Talk

• Hyperliquid (HYPE): HYPE fell 3.3% from midnight to around $79.59 after reaching a record $83.30 late Sunday. The token was one of last week’s strongest performers, helped partly by comments from former President Donald Trump about CFTC oversight, and remains up roughly 28% over seven days.
• Aave (AAVE): AAVE slipped 0.6% to about $140.68 but remained among the week’s top performers, gaining more than 62% over the period. Trading activity stayed elevated as DeFi tokens benefited from the broader risk-on environment.
• XRP: XRP declined 2.8% to $1.48, giving back part of Friday’s advance. The token still gained about 47% over the previous week, outperforming most large-cap cryptocurrencies.
• Morpho (MORPHO): MORPHO dropped 6.2% to around $2.73, making it one of the week’s weaker performers. Despite the pullback, it remained up 18% over 24 hours and 33% for the week, suggesting the latest decline may reflect profit-taking after a strong rally.
• Ethena (ENA): ENA was last week’s standout performer, roughly doubling to $1.79 after recovering from a prolonged decline that had erased more than 90% of its value.

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