Bitcoin back to $118,000 after teasing bulls with $120,000 milestone breach

Bitcoin just hit $120,000 for the first time ever early Friday, before sliding slightly to around $117,297.10 by the afternoon.

That’s a solid 5% jump in less than 24 hours, fueled mostly by a flood of cash into Bitcoin ETFs, according to Coinglass, which also showed that Thursday saw the highest daily short liquidation in four years, totaling around $2.42 billion.

The earlier peak, $118,872.85, came overnight and broke past the previous May high. This jump also pulled Ether up with it. The second-largest crypto climbed nearly 6% to $2,976.90, after briefly crossing back above $3,000 for the first time since February.

The rise didn’t come from nowhere. Those Bitcoin ETFs saw $1.18 billion flow in yesterday, the biggest single-day inflow of 2025. That’s the kind of cash wave that moves mountains. Ether ETFs weren’t quiet either, pulling in $383.1 million, their second-largest haul ever, according to data from SoSoValue.

While BTC kept rising, stocks tied to it started cooling. Mining firms Mara Holdings and Riot Platforms were up just 2.5% and 1.5%, while Strategy, the one everyone treats as a Bitcoin stock, climbed nearly 3%. Platforms like Coinbase, Robinhood, Circle, and eToro barely moved at all.

ETFs flood with cash after Fed minutes

The rally didn’t exactly begin with fireworks. On Wednesday, the Federal Reserve published its meeting minutes, showing officials are split on how fast to cut interest rates. Some want to hold off. Some want to go harder. The market read that as a green light, and Bitcoin started creeping up. By market close, it was surging. The rally was also helped by a run-up in tech stocks.

Markus Thielen, CEO at 10x Research, said that was the moment traders began breaking through the “top range.” He expects the next Fed chair, assuming Donald Trump follows through on replacing Jerome Powell, to take a softer stance. “We also know that saving the budget deficit has sort of been pushed under the rug,” Markus added, pointing to the ‘One Big Beautiful Bill Act’, which could raise the federal deficit and end up being another boost for Bitcoin.

Another thing pushing Bitcoin up was short liquidations. Over the last day, more than $650 million in short bets against Bitcoin were wiped out. Those are traders who borrowed Bitcoin to bet against it, then had to buy it back when the price spiked, pushing it even higher. Ether shorts weren’t safe either, losing over $215 million in the same window. This kind of domino effect, where short sellers get forced out, adds more fuel to the fire.

Fed pressure, Trump threat, and summer slowdowns

Bitcoin ETFs weren’t attracting this kind of money a few months ago. That changed around April 17, when talk started heating up about Powell’s job. That week, Trump said “termination” of Powell might be necessary due to the Fed’s rate stance. That’s when the ETF inflows started growing fast. Since then, total inflows have reached almost $16 billion.

Now, Bitcoin bulls are watching Congress. A crypto bill could pass soon, and treasury departments from large companies are still adding Bitcoin to their holdings. Those two trends, more demand from corporations and better regulation, are keeping the rally going.

But it could still stall if something big happens in global markets. “Powell might turn dovish end of the month at the Fed meeting, and maybe he will not,” said Markus. “So we have to take the market relatively short-term.”

There’s also the seasonal effect. Markus pointed out that summer usually means less trading from equity funds. “Normally, long-only equity investors also pare back their risk into the summer,” he said. That means Bitcoin could either coast or get choppy, depending on who stays active.

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