Bitcoin Rebounds on ETF Inflows and Stable Government Bond Market

Bitcoin (BTC) is trading around $64,800 today, up approximately 1% and holding near its intraday high of $64,926. Demand has started to recover after several sessions of pressure.

The return of capital to U.S. spot Bitcoin ETFs is playing an important role in this recovery. According to recent data, the funds recorded around $189 million in net inflows on Tuesday and another $298 million the day before, bringing total inflows for August close to $951 million.

BlackRock's IBIT attracted around $144 million in the latest reported session. This is significant after three consecutive days of outflows from August 12-14 when investors withdrew around $250 million. The reversal in ETF flows shows that institutional demand is emerging at lower BTC levels.

The U.S. Treasury's decision to double the volume of buyback operations for long-term fixed-coupon Treasury securities also supported the rebound. Starting September 9, the maximum size of operations in the 10-20-year and 20-30-year segments will increase from $2 billion to at least $4 billion per operation.

While this is not an analogue of quantitative easing (QE) and does not represent direct creation of new money, a more stable government bond market and lower yield volatility may support risk appetite, including for BTC. This is especially important now when long-term Treasury yields remain high and compete with cryptocurrencies for capital.