Bitcoin Surges to $80,000 Amid Treasury Bond Buybacks and ETF Inflows
Bitcoin's price has surged to just above $80,000 after climbing from the low $60,000s earlier this month. This represents a gain of about 23% in August, with the cryptocurrency on track for its best August since 2017.
The total crypto market now sits at around $2.75 trillion, driven by three key factors. First, the US Treasury's bond buyback operations have pushed long-term yields and the dollar lower, making it cheaper to invest in riskier assets like cryptocurrency.
Samir Kerbage, CIO at Hashdex, attributed the rally to the change in liquidity conditions rather than anything specific to Bitcoin itself. 'Bitcoin did not rally because something changed about Bitcoin,' he said. 'It rallied because the cost of money changed.'
The second factor is the return of large ETF inflows, which pulled in $2.72 billion during August and brought total assets under management to $98.56 billion.
Lastly, the forced closure of short positions added to the upward momentum, with billions of dollars in short positions being liquidated as the price climbed.