Crypto Markets Rally as Bitcoin Shorts Slashed

The cryptocurrency market experienced a notable rally on Friday, February 13, as investors reacted to a softer-than-expected US inflation report. The total crypto market capitalization surged almost 5% over the past 24 hours to $2.44 trillion, with most large-cap crypto assets seeing moderate gains on the day.

Bitcoin (BTC) climbed back over $69,000, up 4.5% on the day, and pushing its weekly price change into the green, up 1.7%. Ethereum (ETH) rose over 7.5% to trade back above $2,000, bringing weekly gains to 4.4%. The rally was sparked by a US inflation report that came in lower than expected, easing concerns about interest rate hikes and boosting investor sentiment.

However, analysts at glassnode noted that Bitcoin's net unrealized profit/loss has slipped back into the hope/fear regime at around 0.18, indicating thin profit cushions. "This regime tends to be reactive," glassnode said, adding that rallies often meet sell pressure when prices approach key resistance levels.

In other news, futures traders slashed bearish Bitcoin bets last month, a shift that preceded a 70% rally in 2025 and a 190% increase in the BTC price in 2023. This development could be a bullish sign for the cryptocurrency, as it suggests that "smart money" is becoming more optimistic about its prospects.

Meanwhile, decentralized perpetuals exchange Lighter rolled out new trading features, including unified collateral accounts. The platform's native token, LIT, rose as much as 13% over the past 24 hours, but has since retraced to $1.59, up just over 11% on the day. Lighter currently has $925.8 million in total value locked (TVL) and ranks fourth among perpetual DEXs.

In leadership news, Tomasz Stańczak announced that he will step down as co-executive director of the Ethereum Foundation (EF) at the end of February. Stańczak, who has served in the role for around a year, said that the foundation is in a strong place with "new voices," making it a good time for a leadership change. Bastian Aue will take over as interim co-ED alongside current co-ED Hsiao-Wei.

Truth Social Funds also made headlines by filing a registration statement with the US Securities and Exchange Commission (SEC) for two digital asset exchange-traded funds (ETFs). The Truth Social Cronos Yield Maximizer ETF will provide exposure to CRO, the native cryptocurrency of the Cronos ecosystem, while the Truth Social Bitcoin and Ether ETF will hold BTC and ETH. Both ETFs will also offer staking rewards.

The introduction of these digital asset ETFs is seen as a positive development for the cryptocurrency market, as it provides investors with more options for exposure to digital assets. "We are excited to launch our initial two Digital/Crypto offerings under Truth Social ETFs," said Steve Neamtz, President of Yorkville America Equities. "In partnership with Crypto.com, we plan to provide an investment platform for investors covering multiple aspects of digital and crypto investing with both capital appreciation and income opportunities."

Overall, the cryptocurrency market is experiencing a significant surge in prices, driven by a combination of factors including the softer-than-expected US inflation report, the slashing of bearish Bitcoin bets, and the introduction of new ETFs. However, analysts remain cautious, noting that the market is still vulnerable to sell pressure and that the current rally may be short-lived.