Bitcoin Surges to $78,500 Amid US Treasury Rate Cut Optimism

Bitcoin's price surged to over $78,500 on Friday, putting it on track for its biggest weekly gain in more than three years. The cryptocurrency has climbed around 25% this week, a figure that would be its largest weekly increase since March 2023.

The rally is attributed to the US Treasury's decision to double the size of its long-dated bond buybacks, which triggered an upswing in risk appetite and forced traders to liquidate billions in short positions. This move pulled long yields lower, contributing to Bitcoin's price increase.

Rachael Lucas from BTC Markets stated that 'the real driver was the US Treasury doubling long-dated bond buybacks, which pulled long yields lower and lifted risk appetite broadly.' However, Adam Morgan McCarthy from LO:TECH emphasized that 'gold carries this week's real macro signal,' as it rallied cleanly on the Treasury's decision without forced buying.

President Donald Trump's meeting with crypto industry leaders also added to optimism, as he urged the Senate to pass the Clarity Act. Institutional buyers returned to the market, with US-listed spot Bitcoin exchange-traded funds on track for their largest weekly inflows since January, adding over $1 billion so far.