Here are the main reasons that drove Bitcoin’s price to soar to around $123,000:

🏛️ 1. “Crypto Week” in the U.S. Congress

In the week of July 14, 2025, important sessions were held in the U.S. House of Representatives to discuss three bills the Genius Act, Clarity Act, and Anti‑CBDC Surveillance State Act all aimed at establishing a clear regulatory framework for cryptocurrencies, especially the stability of stablecoins, and strengthening the authority of the U.S. SEC.

This move sparked optimism about a positive regulatory environment for the sector.

🏢 2. Massive inflows from institutional investors

Spot Bitcoin ETFs recorded historic inflows of about $3.4 to $3.7 billion over the past week, including a single day that exceeded $1 billion.

Major companies like MicroStrategy (which acquired over 4,225 Bitcoins, worth more than $470 million additionally) continue to inject liquidity.

These large buy orders reduce the available supply, pushing the price higher.

📉 3. Weakening of the U.S. dollar and economic concerns

The dollar’s strength began to decline amid rising U.S. fiscal deficits and trade tensions (such as Trump’s threats to impose 30% tariffs on the EU and Mexico), prompting investors to seek safe havens like Bitcoin and gold.

This surge in Bitcoin and gold was an indicator of an economic state called “crisis mode,” reflecting a shift of liquidity into non-productive assets as a hedge.

⚙️ 4. Short-squeeze liquidations

As Bitcoin quickly climbed past the $120–123K levels, nearly $623 million in short positions were liquidated within 24 hours, around $475 million of which were in Bitcoin alone, adding to the upward momentum.

🧭 5. Technical momentum and attraction to round numbers

The price broke past the $110K barrier in early July, then started a “breakout” that carried it through key technical resistances up to the psychological threshold of $120–123K.

Technical analysis shows liquidity is currently concentrated between $118–123K, contributing to sustained momentum.

✅ Summary

The combination of these factors positive regulation, huge institutional liquidity inflows, a weaker dollar and economic worries, mechanical escalation via short liquidations, and technical moves that amplified the rally are the elements that drove Bitcoin this time to reach unprecedented record levels.

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