Bitcoin Surges as Treasury Secretary's Bond Buybacks Fail to Calm Market

Treasury Secretary Scott Bessent attempted to calm the bond market by doubling planned buybacks of longer-dated government bonds, but his efforts had an unexpected effect on Bitcoin.

The 30-year Treasury yield briefly dropped after Bessent's announcement, but it recovered almost completely, while Bitcoin continued to climb, surging roughly 23% last week - its best weekly gain in more than three years.

This unusual behavior is being attributed to the growing notion that Bitcoin is increasingly being used as a 'debasement trade', an asset investors turn to when government intervention raises doubts about the future purchasing power of conventional money.

Coinage founder Zack Guzman agrees, saying Bitcoin's 20-day correlation with the S&P 500 fell from roughly 0.43 to almost zero during the week, while its correlation with gold climbed above 0.5.