Crypto Market Jumps 22% in Best Week in More Than Two Years

Crypto markets logged a volatile seven-day stretch that combined a sharp rally with a sudden, leverage-driven selloff. Total crypto market capitalization rose 22% in the week ending August 2223, the strongest weekly performance in more than two years, even as a brief flash crash erased about $108 billion in minutes and set off roughly $5 billion in liquidations. Bitcoin finished the week around $77,000–$78,000 after briefly hitting intraday highs near $79,000–$80,000, posting its best weekly gain since March 2024. The advance spread across the market, with several major tokens outperforming. Two developments were widely seen as key drivers. A U.S. Treasury buyback announcement was interpreted as a favorable liquidity signal. Separately, renewed optimism around the Clarity Act—Washington's evolving regulatory framework for digital assets—helped lift sentiment after months of policy uncertainty. Positioning added fuel. Short sellers were forced to cover as prices climbed, amplifying the move. Altcoins reacted more aggressively than Bitcoin: XRP gained roughly 46%–51% on the week, while Ethereum rose about 27%, beating Bitcoin on a percentage basis and suggesting the rally had broader participation. The surge was interrupted on August 22, when the market sold off abruptly. Total crypto market cap dropped by around $108 billion within minutes. More than $500 million in long positions were liquidated in the first hour; over the next 24 hours, liquidations rose to about $1.7–$1.8 billion. Across the broader episode, total liquidations approached $5 billion. Over the week, total crypto market capitalization swung between roughly $2.5 trillion and $2.74 trillion. Prices recovered after the flash crash, underscoring how quickly conditions can flip when leverage is elevated and liquidity thins. For traders, the episode highlighted the risks of oversizing leveraged exposure. The bulk of the $5 billion in liquidations hit leveraged longs—traders aligned with the broader uptrend but forced out by aggressive positioning ahead of the rebound. XRP's 46%–51% jump also stood out as a signal of renewed appetite for altcoins, with investors willing to deploy capital into an asset still associated with past regulatory friction—an indication of greater confidence in a shifting policy backdrop.