Bitcoin Rockets Past $81K on US Treasury Intervention and Deteriorating Dollar
Bitcoin's price surged past $81,000 earlier this morning, marking a three-month high and a remarkable turnaround from last week when it struggled below $65,000.
The US Treasury Department's announcement on August 18 that it would double buybacks of longer-dated Treasury securities is widely seen as the initial spark behind the rally. The move was aimed at improving liquidity and easing pressure in the long end of the bond market, where borrowing costs had skyrocketed.
However, analysts from the Kobeissi Letter suggest that investors were interpreting the Treasury intervention not merely as lower-yield support but as evidence of growing pressure surrounding the US's fiscal policy. This has led to a debasement trade, with capital moving toward scarce assets like BTC and gold when investors fear that fiscal and monetary policies could erode fiat purchasing power.
Ray Dalio recently added fuel to this fire by warning of a potential US debt crisis and recommending investors own gold and 'a bit of bitcoin.'