Bitcoin Bull Market Begins Amid US Treasury Liquidity Injections

A new bull market for Bitcoin has started according to Arthur Hayes, the former CEO of BitMEX. He believes that the US Treasury will continue to inject liquidity into the market, suppressing yields and creating more US dollar liquidity. This could lead to a surge in Bitcoin's price, as it did last week when it broke out of its seven-week trading range and peaked at approximately $79,000.

The rally is driven by fresh external capital re-entering the market rather than capital rotation within the crypto space. Funds are heavily skewed toward BTC and ETH, with only 33% of the top-100 altcoins outperforming them during the period. This indicates that an 'altcoin season' has not yet arrived.

BlackRock's Head of Digital Assets, Robbie Mitchnick, agrees that US debt and fiscal deficits are a major market risk, driving some investors toward alternative store-of-value assets like Bitcoin and gold. As of August 18, the US federal debt stood at approximately $40.05 trillion.