- The cryptocurrency market saw nearly $550 million in long liquidations within 60 minutes on August 22, 2026, following a major rally.
- President Trump’s White House crypto event, where he hinted at a potential U.S. Bitcoin purchase, triggered a short squeeze that liquidated $1.2 billion in short positions within 24 hours.
- Despite the rally, inflation remains above the Federal Reserve’s 2% target, raising the risk of further interest rate hikes that could drive investors out of crypto.
- Analysts warn that Bitcoin could fall to $40,000 by year-end if the promised U.S. crypto purchase plan fails to materialize.
The cryptocurrency market faced a steep correction on August 22, 2026, as nearly $550 million worth of long positions were liquidated in the past 60 minutes, according to data from Coinglass. This sharp reversal follows one of the most significant rallies of the year, sparked by President Trump’s pro-crypto event at the White House. Watcher.Guru reported that the liquidation wave has cast doubt on the rally’s sustainability.
During the event, Trump invited CEOs and founders to promote his administration’s agenda, calling on Congress to pass the stalled Clarity Act. He stated that the United States is considering purchasing a large amount of Bitcoin and other cryptocurrencies, which sent prices soaring. Consequently, about $1.2 billion in short positions were liquidated within 24 hours of that announcement.
However, the rally appears short-lived as inflation dipped in July 2026 but remains well above the Federal Reserve’s 2% target. If costs stay high, the Fed may hike interest rates, potentially triggering further investor exodus from the crypto market. Meanwhile, the entire rally hinges on Trump’s pledge; if the purchase plan does not follow through, sentiment could collapse. Some analysts now predict Bitcoin could fall to the $40,000 mark by the end of the year before an eventual recovery.
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